KARACHI: Stock investors opted to book profits in the outgoing week, which resulted in the benchmark index closing in the red.

Arif Habib Ltd said market-driving news included the Asian Development Bank announcing a $1.2 billion loan agreement with Pakistan. In addition, the World Bank approved $350 million for economic reforms.

After June 2023, Pakistan recorded for the first time a monthly current account surplus of $9m. Additionally, the Economic Coordination Committee (ECC) approved a proposal from the Power Division to settle the dues of government-owned power plants using a supplementary grant of Rs262bn. The ECC also approved the release of an advance subsidy of Rs57bn concerning K-Electric Ltd arrears.

In November, Pakistan witnessed a notable year-on-year rise of nearly 20pc in the average power generation cost, which is largely attributed to an increase in generation from expensive fuels. Additionally, foreign exchange reserves of the State Bank of Pakistan declined by $138m to reach $6.9bn.

During the week, the rupee closed at 282.53 against the greenback after appreciating by 0.26pc week-on-week.

As a result, the KSE-100 index closed at 61,705 points following a decline of 4,425 points or 6.7pc week-on-week.

Sector-wise, negative contributions came from commercial banking (1,029 points), fertiliser (785 points), oil and gas exploration (576 points), cement (388 points) and technology and communication (294 points). Meanwhile, the only sector that contributed positively was miscellaneous (16 points).

Scrip-wise, negative contributors were MCB Bank Ltd (265 points), Oil and Gas Development Company Ltd (257 points), Engro Corporation Ltd (251 points), Dawood Hercules Corporation Ltd (240 points) and Fauji Fertiliser Company Ltd (174 points).

Positive contributions came from Pakistan Services Ltd (17 points), Interloop Ltd (five points), Pakgen Power Ltd (two points) and Pakistan Aluminium Beverage Cans Ltd (one point).

Foreign buying clocked in at $2.4m versus a net purchase of $6.3m a week ago. Major buying was witnessed in power generation and distribution ($3.5m) and cement ($1.1m). On the local front, selling was reported by mutual funds ($14.3m) and individuals ($2.6m). The average daily traded volume arrived at 1.2bn shares, down 3pc week-on-week. The average daily value traded settled at $78m, down 27pc week-on-week.

According to AKD Securities Ltd, the stock market may see a correction going forward. “Our advice to investors is to retain long-term positions in companies with solid fundamentals,” it said.

Published in Dawn, December 24th, 2023