The momentum gathered in the last trading session of earlier week, fueled further on the first trading session of the week ended on April 15, 2022. The investors across the board welcomed newly formed government; set up of coalition parties (PML-N, PPP, JUI-F and MQM-P) led by Shehbaz Sharif as newly elected Prime Minister. Filled with exuberance, the benchmark KSE-100 index registered 1,700 points on Monday – the largest single day return of 3.83%DoD to close the index at 46,145 points. The rally continued throughout the week, keeping KSE-100 index above 46,000 levels and closing the week at 46,602 points, up 4.85%WoW.
To top it off, PKR appreciated 1.7%WoW against the US$. Moreover, participation remained strong throughout the week averaging daily trading around 477 million shares, up 212.6%WoW. Major news flows during the week were: 1) The National Assembly expressing non-confidence in Imran Khan and electing Shehbaz Sharif as new Prime Minister, 2) The IMF welcoming SBP’s decision of raising the policy rate by 250bps to 12.25%, 3) GoP owing OMCs PKR55 billion in April 2022 fuel subsidy, 4) The new PM sending positive signals to China, United States, Russia and India, 5) Car sales in March 2022 increasing by 25/30% QoQ/YoY respectively, 6) Remittances in March 2022 rising to US$2.8 billion, and 7) Barrick betting big on Pakistan with US$7 billion in copper mining project.
Sector wise, Refineries topped with a gain of 26.6%WoW, followed by Engineering (9.4%WoW) and Tech (8.2%WoW), whereas across all sectors Woollen and Leasing gained 13.3%WoW and 11.2%WoW respectively – the most after Refinery sector. Flow wise, Individuals remained the major buyers with net buy of US$18.9 million) followed by Companies (US$2.12 million), while Mutual Funds were stood on the other side with net sell of US$9.9 million) followed by Insurance companies (US$7.8 million). Top performing stocks for the week were: CNERGY, NRL, ATRL, AVN and PIBTL, while laggards included: COLG, HGFA, GLAXO, MUREB and FML.
The positive momentum in the market is likely to continue in the near term. However, political arena is also heating up with PTI staging peaceful protest across the country. Even though this largely remains non-event from stock market’s vantage, any escalation in tensions can have negative impact on investor’s sentiment. Result season is likely to pick up pace in the upcoming week where surprises cannot be ruled out for driving individual stock performance. Major companies scheduled to announce results next week are: EPCL, POL, MLCF, EFERT, FFBL, ABL, HBL, UBL, ATRL, ASTL, ISL and ENGRO. Investors are advised to build long-term positions, limiting short-term trading.