KARACHI: Investor emotions were dampened by a dearth of positive triggers on the Pakistan Stock Exchange (PSX) over the previous week. As a result, the KSE-100 index rose 0.5 percent to 44,118.39 points at the end of the week.
The benchmark KSE-100 index surged nearly 400 points in cautious trading on Monday, as investors took advantage of the central bank’s liquidity injection after bullish large-scale manufacturing (LSM) data issued last week.
However, the market’s exuberance was short-lived, as the bourse succumbed to selling pressure as the expanding current account deficit in November, which totaled $1.91 billion, impacted investors’ views and shook their faith.
On Wednesday, the benchmark index extended its losses as the Pakistani rupee continued to depreciate against the local currency and investors remained cautious ahead of an Rs400 billion mini-budget.
Fortunately, the market reversed course on Thursday, rising roughly 91 points in choppy trade as investors applauded news from the finance ministry that the sixth assessment of the Extended Fund Facility will be submitted to the International Monetary Fund’s (IMF) executive board on January 12.
However, the benchmark index ended the week on a negative note as investors’ optimism faded owing to fears about increased inflation and a drop in the central bank’s total liquid foreign currency reserves, mostly due to external debt repayment.
The current account deficit for November was $1.9 billion, the central bank announced a 63-day liquidity injection via open market operations, the government released the new Auto Policy (AIDEP 2021-26), and SBP foreign currency reserves declined to $18.1 billion during the week.
Foreign selling, on the other hand, has persisted this week. In the oil and gas exploration business, there was a lot of selling.
The average volume moved during the week under review was 215 million shares, down 19 percent from the previous week, and the average value transacted was $45 million (down by 5 percent week-on-week).
The week’s top gainers and losers
Power (+4.1 percent), pharmaceutical (+3.5 percent), food (+2.2 percent), cars (+2.2 percent), and technology and communications (+1.8 percent) all contributed positively. Chemical (-2.9 percent) and textile composites, on the other hand, had negative contributions (-1.5 percent ).