Pakistan Strategy_Index gains in Nov'22, Rate hike dampens outlook, (AKD Daily, Dec 01, 2022)
Pakistan Strategy: Index gains in Nov’22, Rate hike dampens outlook
- KSE-100 index gained 2.6% or 1,084 points during the course of the month. At the start of the month, the market was pressured by the assassination attempt on Imran Khan. However, the market rebounded quickly, reaching a high of 43,000 points.
- The SBP’s surprise move to hike interest rates by 100bps near the end of the month reversed the gains from earlier, with the market losing ~865pts in the next trading session.
- Average participation during the month remained lackluster at 286mn shares, compared to 296mn shares in the earlier month, with the KSE-100 index average volumes dropping substantially from 94mn shares in Oct’22 to 83mn shares in Nov’22—indicating a tilt away from the main board and towards side stocks during the month.
- Technology & Communications sector posted gains of 12.3%MoM during the month, with TRG and SYS posting gains of 31% and 12.8%MoM, respectively. The star of the sector was TRG during the month, with the news of a possible acquisition of Ibex Global Holdings Limited by CVC Capital Partners making the rounds.
- The high interest rates in the country are likely to remain a reality for longer as external debt principal and interest servicing, amidst dwindling reserves, could keep inflationary pressures mounting, making the case for high policy rates to persist.
- Market participants are likely to be eyeing the upcoming IMF’s 9th review of Pakistan. Ahead of the discussions with the IMF, the Finance Ministry has been implementing the group’s recommendations, as evident from the increase in Petroleum Development Levy on HSD to PkR25/liter in the latest price revision. However, the market is expected to remain range-bound given the high interest rate environment in the country.
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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