Pakistan Strategy_Aug’22 Market Review & Outlook, (AKD Daily, Sep 01, 2022)
AKD Daily
Aug’22 Market Review & Outlook
The KSE-100 index traded up by 5.5%MoM, gaining ~2,200pts during the month, with confidence returning to the market following the IMF’s executive board’s approval of the 7th and 8th tranche to Pakistan—totaling US$1.2bn, reversing the losses from the previous month (Jul’22 KSE-100 down 3.3%MoM). This takes the CYTD return of the index to –5.0%.
Volumes were strong during Aug’22, with daily volume in the market averaging 438.2mn shares during the month, compared to ~223mn shares in the earlier month. Of these, KSE-100 volume averaged 229.47mn shares on a daily basis in Aug’22.
PkR strengthened against the USD during the month by 9.4% with sovereign default fears subsiding. Consequently, the index returned a US$-denominated return of 13.8% during the month.
On a sectoral basis, the best performing sectors in Aug’22 were Automobile Parts Manufacturers/Woolen/Refineries, returning 19.0%/18.3%/14.0%, respectively. As opposed to this, Miscellaneous/Tobacco/Vanaspati were the worst performing sectors during the month, posting a negative return of 22.8%%/13.2%/9.5%, respectively.
With Pakistan’s external situation now appearing manageable, outlook for the market appears positive, however, onset of floods as well as continued inflationary pressures may temper outlook. In the short-term, with IMF in the bag, the market will be looking at; i) further flows from bilateral and multilateral agencies, ii) inflation reading for Aug’22, and iii) result of the on-ground verification of the FATF team, expected to conclude by Sep 2, 2022.
AKD Research
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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