EUR 14.08 For Business Accounts Only

Stock Smart Weekly (Mar 08,2024)

Week started on a positive note, with the index gaining 1% on the opening day. However, as the week progressed, profit-taking activities ensued, tempering some of the initial gains. Nonetheless, by the week's end, KSE100 index managed to maintain an upward momentum, closing with a gain of 468pts/0.7%WoW at 65,326pts by Friday. With new Prime Minister taking office and issuing immediate directives focusing on engaging with the IMF and addressing privatization matters set an initial positive impetus for the week. With new setup in place last week, IMF started rolling out new recommendations and is poised to unveil more with the appointment of the finance minister. Govt's next major task will be to smoothly navigate the second review of the SBA. IMF’ team is scheduled to visit following the formation of the new cabinet, as SBA program is set to expire in Apr’24. Furthermore, the recent decline in cut-off yields for 3-month papers in last T-bill auction hints volatility, suggesting that some players anticipate a rate cut in the upcoming MPC meeting on March 18th. Additionally, remittances for Feb’24 totaled US$2.25bn (↑13%YoY), and with trade deficit of US$1.7bn for the month, current account is expected to remain controlled.

Market participation also remained subdued, with the daily traded volume averaging 412mn sh compared to 418mn sh in the previous week, down 1.6%WoW. On the currency front, rupee held its ground against the greenback, closing at PkR279.04/US$ (↑0.06%WoW). Other major news flows during the week included; 1) Jul-Jan debt rises 6pc, 2) SBP injects Rs8tr to ease liquidity woes, 3) Bank deposits surge 21.7pc y/y in Feb on record-high interest rates, remittances, 4) Feb cement dispatches fall 19.22pc to 3.26MT YoY, and 5) Textile exports hit $1.41 billion in February, up 20pc YoY. Sector-wise, Transport, Refinery, and Inv. banks/securities cos. were amongst the top performers, up 20.4%/11.0%/6.6%WoW respectively. On the other, Tobacco, Modarabas, and Textile weaving were amongst the worst performers with a decline of 4.9%/2.7%/2.6%WoW. Flow wise, major net selling was recorded by companies with a net sell of US$6.8mn. On the other hand, Foreigners absorbed most of the selling with a net buy of US$6.3mn. Company-wise, top performers during the week were, i) NRL (up 23.5%WoW), ii) DAWH (up 13.5%WoW), iii) CNERGY (up 13.2%WoW), iv) PAEL (up 11.4%WoW), and v) PSX (up 11.4%WoW), while top laggards were, i) SML (down 7.1%WoW), ii) FCEPL (down 4.5%WoW), iii) PAKT (down 4.5%WoW), iv) MEBL (down 3.5%WoW), v) SHFA (down 3.2%WoW).