KARACHI: Bulls lifted the KSE-100 index above the 41,000-point mark for some time as it traded at 11-month high levels, supported by buying interest in stocks of oil companies during the outgoing week on Friday.
Index closed on a positive note for the seventh consecutive week as the benchmark KSE 100-share Index gained 184 points or 0.5 per cent on a weekly basis before closing at 40,917 on Friday.
The index was last seen trading above 41,000 points in February 2019. So far, the market has regained over 11,000 points after hitting a five-year low at 28,671 points in August 2019. The index has been lifted by 7,259 points or 21.6 per cent in the last seven weeks.
“There is a general belief that after these index adjustments, the support from key players will increase in upcoming sessions,” dealers said.
After amassing a run up of 10 per cent in the last month, the KSE100 index traded around the psychological level of 41,000 index points.
According to an analyst from Arif Habib, the KSE100 index on Friday increased by 402 points (0.98%) and 184 points (0.45%) for the week.
Major developments for the week were, firstly, inflow of $1.3 billion from Asian Development Bank (ADB) for budgetary support and to address power sector reforms, secondly, worker remittances during November which stood at $1.8 billion (up 9.4 percent as compared to the same month last year), thirdly, forex reserves reaching $16 billion, up by 0.4 percent on a weekly basis, excluding tranche received from ADB, and fourthly, the latest PIB auction that saw 10-yr PIB cut off below 11 per cent that was last seen in Oct.18.
Foreign investors were net sellers of shares during the outgoing week, accumulating positions worth $5.8 million.
Among local investors, companies and brokers moved in the same direction as the foreign investors’ portfolio cumulative net sold $10.20 million.
This was, however, offset by individuals, mutual funds and insurance companies, who cumulatively net bought $15.41 million.
“While the market lose its momentum during the week, the improving macroeconomic indicators coupled with higher central bank reserves could keep market participants interested”, an analyst from Habib MetroFinancial said.
“We believe the index will continue its upward journey as the economy depicts signs of resurrection”, said an analyst from Arif Habib.
Improvement on the external front together with stability in the Pakistani Rupee is expected to reassure foreign investors.
Meanwhile, inflationary readings are set to touch peak in January 2020 with an imminent interest rate cut to follow, domestic investors remain jubilant as well, he said.
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