KSE index posts maximum weekly gain since 2013
OBSERVER REPORT KARACHI—A historic last week at the bourse saw the KSE-100 index pushed to its all-time high and close at 38,776.94 as the market celebrated news of MSCI reclassifying its Pakistan index to emerging market status early on Wednesday.
The reclassification, which would take effect next year, helped the market rally up 1,000 points on Wednesday with the next two days being rather subdued. Nevertheless, the index gained 5.0 per cent (1,836 points), for its highest weekly gain since the first week of July 2013.
The news drove broad based buying interest and the market witnessed historic highs during the week with key interest in the list of stocks to be included in both small-cap and main index. Amidst euphoric trading sessions, the market completely disregarded negativities such as PakAfghan border tensions and turbulence in the political landscape.
The MSCI reclassification and Senate’s approval of corporate restructuring Companies bill 2016 meant that the banking sector remained in the limelight during the week, posting 13.1 per cent return during the week with Habib Bank Limited, MCB and United Bank Limited posting double digit return of 20.9 per cent, 14.8 per cent and 12 per cent respectively. Furthermore, HBL, MCB and UBL cumulatively added 901pts in the index.
The cement sector followed on as it increased 6.2 per cent. Engineering was among the under performers as it fell 1.3 per cent during the week.
Moreover, investors also showed insensitivity towards 6per cent week-onweek decline in international crude oil prices as observed from 0.4per cent week-onweek increase in index heavyweight oil and gas sector.
Dawood Hercules Corporation accumulated 97 points on the back of substantial holding in Engro, another MSCI EM constituent, which helped scrip remain in the limelight.
Additionally latest news sources confirm the Economic Coordination Committee (ECC) has ordered an increase in the price of RLNG by US$1.2/mmbtu, allowing a series of factors that were previously rejected by Oil and Gas Regulatory Authority (OGRA).
Foreigners also continued to make thematic investments (pertaining to MSCI and China Pakistan Economic Corridor) during the week with net inflow recorded at $19.6 million.
The average traded volume jumped 21 per cent week-on-week to 183 million shares while average traded value increased by 57 per cent week-on-week to $124 million.
Average daily volume increased 21 per cent to 183.4 million shares, coupled with 57 per cent rise in average daily value to Rs13.0 billion/$124.1million.
Habib Bank Ltd operates commercial bank in Pakistan. The bank offers commercial, corporate, Investment, retail and International Group Banking.
Pakistan Services Limited is the holding company for Pearl Continental Hotels (Private) Limited, which constructs, operates and manages hotels. The group also owns a number of smaller companies that provide renta-car, travel arrangements and tour packages.
National Refinery Limited manufactures and distributes lube base oils and petroleum fuels. The company markets its products to customers throughout Pakistan.
EFU Life Assurance Ltd provides a variety of insurance services. The company’s services include loan protection plan, savings plan, executive pension plan and education plan.