Stocks on Friday drifted to a
two-dimensional close in sleepy trade mostly because there was nothing for
investors out there to get excited about, traders said.

Benchmark KSE-100 Shares Index ticked up by
0.25 points or 0.0 percent at 45,763.45 points at Pakistan Stock Exchange (PSX)
with the highest and the lowest of the day being 45,989.23 and 45,734.30
points.

Analyst Ahsan Mehanti at Arif Habib Corp said stocks closed flat
amid thin trade as investors weighed the surge in global crude oil prices and rupee
recovery.

National Assembly’s approval of Rs360 billion mini-budget and
autonomy to State Bank of Pakistan (SBP) ahead of International Monetary Fund’s
(IMF) Extended Fund Facility (EFF) review helped stocks end in the green,
Mehanti said.

KSE-30 Shares Index also ended almost unchanged at 17,998.51
points.

The Lower House has passed mini-budget and SBP autonomy bill that
were two key conditions set by IMF for the approval of sixth review of EFF.

The mini-budget gives effect to withdrawal of tax exemptions of
over Rs350 billion, whereas SBP bill envisions to increase the autonomy of the
central bank. SBP bill is also needed to be passed by the Senate before it
comes into effect.

To recall, Pakistan had requested IMF to defer Pakistan’s review
to the end of this month which was initially scheduled on Jan 12, 2022.

Trade volume shrank 88 million shares to 239.97 million from
327.60 million. The trading value dropped to Rs6.09 billion from Rs6.48
billion, while market capital, however, expanded to Rs7.846 trillion from
Rs7.832 trillion. Out of 350 actives in the session, 136 advanced, 194
retreated, while 20 remained unchanged.

Topline Securities in a post-trade note said the index largely
remained positive during the trading session; however, some pressure was
observed at closing and it closed on a flat note. Major contribution to the
index came from HBL, PPL, DAWH, INDU, and BAFL, as they cumulatively
contributed 74 points to the index, on the flipside HUBC, LUCK, TRG, AVN and
UNITY lost value to weigh down on the index by 66 points, the brokerage said.

The highest increase was recorded in shares of Unilever Foods,
which rose Rs166 to Rs20,490 per share, followed by Nestle Pakistan, up
Rs124.25 to Rs5,524.25 per share. Being the worst loser, Premium Textile fell
Rs39.98 to Rs610.01 per share, trailed by Siemens Pakistan, down Rs19 to close
at Rs625 per share.

JS Research in its market warp said PSX witnessed dull activity as
investors preferred to stay on the sidelines.

Major laggards in terms of index points contribution were HUBC,
LUCK, UNITY, AVN, and TRG, the brokerage said.

“Going forward, we recommend investors to avail any downside as an
opportunity to buy in technology, fertiliser, oil and gas exploration, and
cyclical sector stocks,” the JS Research analysts recommended in the report.

One analyst attributed the dull activity to the lack of any major
triggers.

An increase in auto sales could not help the market pick up, as
only local retailers were involved in the trading in the absence of major
buyers, he said adding, activity was recorded mostly in smaller stocks.

Unity Foods Ltd was the volume leader with 26.26 million shares,
with WorldCall Telecom right behind it with 25.13 million shares.

Some significant volume-makers included Cnergyico PK, Dost Steels
Ltd, Unity Foods Ltd, Telecard Limited, Pervez Ahmed Co, TRG Pak Ltd, Lotte
Chemical, and Hascol Petrol.

Turnover in the future contracts receded to 56.34 million shares
from 66.16 million.

Rupee highest in a month


 The rupee strengthened to its highest
in more than a month on Friday, buoyed by reduced dollar demand from importers
for payments as well as expectations for revival of the IMF funding, dealers
said.

In the interbank market, the local unit
ended at 176.06 to the dollar, its strongest level since November 29. It had
closed at 176.38 on Thursday.

“A slowdown in importer demand as a result of the measures taken
by the central bank and the government to curb imports have pushed the rupee
up,” said a foreign exchange dealer.

The expected approval of the sixth review of Pakistan’s Extended
Fund Facility (EFF) by the International Monetary Fund’s (IMF) executive board
in a few weeks also boosted sentiment on the local currency.

“Today’s rupee appreciation is also sentiment-based. Traders
assume the IMF board will clear the sixth review of its $6 billion loan
programme for the country at a review meeting to be held later this month
following the passage of two bills from the national assembly,” he added.

The revival of the IMF funding is expected to help the country’s
external current account as it will lead foreign inflows from other
multilateral and bilateral agencies.

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2022-01-15

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