KARACHI: Pakistan Stock Exchange (PSX) ended another stressful week (and an equally stressful financial year) in the red as benchmark KSE-100 index closed the week ended June 28, 2019 at 33,901 points, posting a loss of 3.5%.
“This week’s closing marks the 30th negative one during the outgoing financial year during which the index dipped 19%,” Ali Zaidi at JS Global Capital said.
This week saw improved market participation as volumes during the five trading sessions averaged at 146 million shares/day (up 17% from last week) while average traded value inched up by 5% to US$28 million/day.
Foreign buying was witnessed this week clocking-in at USD 7.9 million compared to a net sell of USD 5.7 million last week.
Local equity bourse continued to be in the doldrums for another week primarily on the back of despondent economic conditions in the country. “The Pak Rupee once again continued its downslide against the USD, depreciating 2.0% WoW to close at PKR 160.05/USD. Moreover, gas tariff hike of upto 191% was approved by the Economic Coordination Committee (ECC), which will aggravate inflationary pressure in the economy, lending credence to concerns of further monetary tightening by the State Bank of Pakistan (SBP),” a report issued by Arif Habib Limited noted.
Other noteworthy news that affected the market include: Qatari Emir’s visit to Pakistan and his decision to inject USD 3.0 billion into the economy in the form of investments and deposits, Fitch Solutions predicts Pakistan’s GDP could further shrink to 2.7% in FY20, the final version of the budget to be shared with the IMF by July 3rd, Prime Minister Khan hinting at extending the deadline for the Asset Declaration Ordinance and signing of LoI to obtain the USD6.0 billion from the IMF.
“We expect the market may rebound next week. However, formal approval by the IMF of the bailout package for Pakistan may provide some relief to investors. Clarity is likely to emerge over the main features of the program which may appease major concerns of investors,” Arif Habib Limited said.