AKD STOCK SMART, Dec 13, 2019
StockSmart
Weekly Review
The KSE-100 closed at 40,917pts, up 0.45% WoW, cooling down after a stellar 14% bullish momentum in Nov’19. Following Moody’s upgrade of Pakistan’s outlook from ‘Negative’ to ‘Stable’ last week, Asian Development Bank (ADB) announced US$1.3bn budgetary support to Pakistan – the funds came in mid-week. Despite sukuk payment of US$1bn in early Dec’19, forex reserves are reportedly expected to touch 8 month high of US$10.4bn. On the same note, IMF’s board meeting, scheduled on 19th Nov’19, is expected to be followed by US$450mn tranche release. During the week, Pakistan also submitted a progress report to FATF, meanwhile indicting Hafiz Saeed for terror financing. FATF will raise questions on submitted compliance report of Pakistan till third week of December, followed by Pakistan’s formal response on 7th Jan’20. Additionally, SECP approved regulation that would come into effect from end Jan’20 under which trading at the stock market will be brought to a halt when KSE-30 index moves up or down by 4pc in a single trading day. SECP also approved the increase in circuit breaker levels to 7.5pc from existing 5pc, laying out groundwork for the launch of Exchange Traded Funds (ETF) in 1QCY20. Other major news flow during the week included: (i) 44% decline in Car sales in Nov’19 as increased prices and exorbitant auto financing dampened the consumer buying sentiments, (ii) workers’ remittances amounted to US$1.82bn, 9.35% higher than in Nov’18, (iii) SBP’s fine of PkR60.8/92.0/14.0/26.0mn for ABL, MCB, BOP and HBL, (iv) yields on 3/5/10 yr PIBs declining by 5/26/35 bps since last auction (v) 33% decline in trade deficit to US$9.7bn over 5MFY20, (vi) SBP allowing banks to make advance payment up to 50% of the value of imports against letter of credit for manufacturing concerns and (vii) Swiss parliament approve exchange of bank data with Pakistan amid other countries from 2021. Top performers during the week included NCL (+5.51%WoW), OGDC (+5.48%WoW) and PPL (+4.55%WoW), while PSMC (-12.23%WoW), PIOC (-9.96%WoW) and ASTL (-8.36%WoW) remained the worst performers. Average daily turnover declined 40.7%WoW to 275mn shares where UNITY (168mn shares), FFL (65.36mn shares), BOP (54.84mn shares), PAEL (49.55mn shares) and KEL (49.32mn shares) remained major volume churners.
Outlook
After gaining 42% from its CYTD low, profit taking may keep the market range bound. However, continued build-up in FX reserves following IMF board meeting and, encouraging developments on FATF compliance front could push market to test the resistance levels in the upcoming weeks.
Oil and Gas Development Company is a petroleum exploration and production (E&P) company in the Pakistan oil and gas sector. Co.'s principal activity is to explore, develop, produce and sell oil and gas resources and related activities. Co. also manufactures Gas, Liquefied Petroleum Gas, Crude Oil, and Sulphur. Co.'s major fields contributing in the aforesaid production of crude oil include Nashpa, Kunnar/KPD, Pasakhi, Sinjhoro and Rajian and for gas include Qadirpur, Uch, KPD, Nashpa and Dakhni. Co. carries out exploration and development activities on its own as well as in joint ventures with other oil companies.
AKD Securities Ltd. is one of the leading securities firm in Pakistan, providing a comprehensive range of investor focused services, including equity brokerage, economic and securities research, investment banking and financial advisory services. AKD Securities accounts for more than 6% of the average daily value of the Karachi Stock Exchange. AKD Securities was the first brokerage house to launch an online trading platform in Pakistan in November 2002 and now has the largest market share with over 6000 customers. This has helped diversify and expand the retail investor base in the country and ushered in a whole new universe of investors to the stock market.
AKD Securities Ltd. caters to a diversified group of domestic and international institutional investors, high net worth individuals and upscale retail clients, including expatriate Pakistanis. With high quality research, unparalleled execution and distribution capability for both regular and large block trades, AKD Securities Ltd. has earned an outstanding reputation in the Pakistani securities industry.Outside of commercial banks, AKD Securities Ltd. is one of the biggest capital market firms in the country. AKD Securities is the leader in raising and providing risk capital in underwriting, market making and mergers and acquisitions in Pakistan. Good corporate governance and professionalism are emphasized throughout the firm and AKD Securities Ltd. is amongst the very few companies to have introduced a firm-wide comprehensive CODE of ETHICS, overseen by an independent compliance manager.Ultimately, our success is based on the quality of service we provide to our customers and the trust and confidence reposed in us by them. Our focus, therefore, remains on customer satisfaction at all levels in the company.
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