Pakistan equities gain 0.9% as funds start flowing from multilateral lending agencies |

Pakistan equities gain 0.9% as funds start flowing from multilateral lending agencies

KARACHI: Despite closing two of the five trading sessions in the red, Pakistan Stock Exchange (PSX) closed the week ended July 5, 2019 with a gain of 0.9% (288 points), pushing up the benchmark KSE-100 index to 34,190 levels. “This week trading commenced on a positive note as investors rejoiced the 3-day extension in Tax Amnesty Scheme as well as finance bill approval in the parliament. Furthermore, first tranche of the USD 500 million received from Qatar along with loans arranged from syndicated banks and World Bank aided foreign currency reserves,” a report issued by Arif Habib Limited noted.. “Tally by the end of first three trading days unveiled a positive run 995 points at the index. However, investors resorted to profit taking post official agreement of the IMF Board for a USD 6bn package for Pakistan coupled with strike from cement dealers, automobile dealers and closure of textile units on budgetary measures”. Foreign buying at the bourse continued this week clocking-in at USD 5.9 million compared to a net buy of USD 7.9 million last week. Other major news: i) IMF okays $6bn package to ‘foster strong growth’, ii) USD 500 million received from Qatar, iii) World Bank approves USD722 million loan for Pakistan, iv) June inflation eases to 8.9%, v) Minister announces up to 168% rise in gas prices and vi) Forex reserves rise to USD14.443 billion. Analysts view the market to remain positive in the upcoming week in lieu of the IMF package approval and recent appreciation of PKR against green back which will lift investors sentiments. Whereas, key risks to the index include economic concerns on account of high Current Account Deficit, slowdown in large scale manufacturing and further monetary tightening expected in upcoming monetary policy on the back of tariff hike of utilities (gas and electricity) which could trigger inflation noticeably going forward.
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