Pakistan Stock Exchange Benchmark Index Declines 6.69% WoW – OpEd
After touching successive high for the last two months, the benchmark index of Pakistan Stock Exchange (PSX) losing 6.69%WoW to close at 61,705 points. Overall, selling in scrips was witnessed as the year closes. On the brighter side, after much anticipation, ECP issued the elections schedule for February 08, 2024.
Moreover, Pakistan recorded a current account surplus of $9mn in November 2023 after having seen four consecutive deficits in the months before.
Ministry of Energy authorized the plan to settle PKR262 billion payables to WAPDA and GPPs in accordance with IMF’s direction, to curb the rising power circular debt.
Moreover, Foreign Direct Investment for the first five months of current fiscal year rose to US$656 million, reflecting an increase of 8%YoY.
Power generation cost surged by 20%YoY in November 2023 to PKR7.17/kWh.
Market participation witnessed a slight decline, with daily traded volumes averaging 1.22 billion shares down 3%WoW).
On the currency front, the Pakistani Rupee maintained its appreciation momentum by gaining 0.26%WoW against the US Dollar, closing at PKR282.53/US$ by week-end.
Other major news flows during the week include: LSMI output for October 2023 decreased by 4.08%YoY, 2) Textile exports fell by 5.43%MoM in November, 3) Jul-Nov borrowing declined US$0.829 billion YoY to US$4.285 billion, 4) SBP reserves fell by US$136 million to US$6.91 billion, 5) Petroleum group imports for Jul-Nov witnessed 16.19%YoY negative growth.
Textile Weaving and Automobile Parts & Accessories were amongst the best performers, whereas, Close Ended Mutual Funds, Modarabas, and Investment Banks were the top laggards.
Major net selling was recorded by Mutual funds with a net sell of US$14.26 million. Insurance companies absorbed most of the selling with a net buy of US$9.31 million.
Top performing scrips of the week were: PSMC, HCAR, PSEL, while top laggards were: PIBTL, ANL, PAEL, DAWH, and PSX.
Going forward the market may see a correction, but still end the year with a positive note. Upcoming elections hold significance, and their successful conclusion could further elevate investor confidence.
Analysts advice the investors to retain long-term positions in companies with solid fundamentals, meanwhile exercising prudence in dealing with any fundamentally weak entities through a timely profit-taking approach. Moreover, companies with robust dividend yields, particularly in the Banking, Energy, and Fertilizer sectors, present opportunities for accumulation.
