After the bears had run rampant last week, Monday, October 16 saw the bulls return at the KSE-100 index as it gained 945 points to close at 40,791 points. Positivity took over the market leading to improvements in scrip performances, as news of a possible package for the PSX by the government made rounds amongst investors. Reports had highlighted the possibility of an injection of Rs.20 billion into the PSX to bolster its performance. The demand for this package was put forth by directors of the PSX, brokers and mutual fund representatives as they met with PM Shahid Khaqan Abbasi on October 14, 2017. Stakeholders demanded a market support fund worth Rs. 20 billion under the management of National Investment Trust (NIT) for the dedicated revival of the PSX. As the demands are now being processed under a committee led by Sindh Governor Mohammad Zubair – they will be forwarded to the PM for review before a decision is made. The oil sector gained 158 points amid chatter of new sanctions being imposed on Iran. The cement sector witnessed a gain of 146 points as news of cement producers meeting to keep prices firm surfaced in the market. The fertilizer sector and banking sector gained a total of 252 points. Average trading volumes remained low as they were recorded at 125 million with a value of Rs. 6 billion.
Tuesday saw a mixed session for the PSX, opening on a high note and reaching 41,353 points during the day before the ears took over. The index witnessed a downward spiral and closed at 40,725 after shedding 66 points. The index had hit a low of 40,692 points on Tuesday. The market remained bullish during the initial trading hours, however, political uncertainty continued to erode investor sentiments, resulting in profit-taking causing the index to slip. Volumes noted a 34% day-on-day improvement as they were recorded at 167 million shares, with a value of Rs. 9.7 billion.
The flat performance carried on to Wednesday as the KSE-100 index closed at 40,733 after gaining 8.5 points. However, Wednesday’s market performance was mostly bearish, with recoveries being witnessed during the last few minutes of the trading session, causing losses to be recovered. The market sustained a low of 40,224 points and a high of 40,872 points during Wednesday’s trading session. The first half of the trading session remained volatile as news of the court hearing against Finance Minister Ishaq Dar continued to flow in. However, the recovery towards the end of the trading session was primarily due to the interest in the earnings season, as September 2017 brought improved sales performance in the oil and cement sector. DGKC results were higher than expected which caused it to be a positive trigger for the market on Wednesday. The chemical sector dominated the trading session on Wednesday as it led volumes with 22.8 million shares traded. Engineering and cement sectors followed suit and recorded volumes at 20 million and 13.5 million shares respectively. Average volumes remained low over all as they were recorded at 138 million with a value of Rs. 6 billion.
Thursday proved itself to be a positive day for the market as the bulls paraded. The KSE-100 index gained 825 points during the day to close at 41,558. The positive market trend was witnessed as investors welcomed the indictment verdict of the ousted Prime Minister Nawaz Sharif and his family on corruption charges. The market had secured a high of 41,614 points during the day just prior to the trading session coming to a close. According to analysts, higher import duties for automobiles and diminished political noise during the day proved to be positive catalysts for the market on Thursday. The trading session on Thursday reported high volumes with share turnover at 232 million, valued at Rs. 11.5 billion. The fertilizer sector performed the best on Thursday as it added 160 points to the index, followed by 157 points by cement, 93 points by oil and gas marketing, 70 points by oil and gas exploration and production and 42 points by engineering. The session on Thursday signified positive investor sentiments, as investors went all in to purchase shares at attractive prices. The power and engineering sectors dominated the trading session as their volumes were recorded at 31.72 million and 31.68 million, respectively.
The session on Friday, October 20, 2017, proved to be dominated by the bulls once again as the market gained 529 points to close at 42,087 points. The market had witnessed a high of 42,155 points and a low of 41,471 points during the day. The first half of the trading session appeared to be more volatile. However, it was during the second half of that the market was propped up by positive momentum. Volumes remained high at 261 million, with a value of Rs. 13 billion. It was primarily the better than expected financial results of the cement and oil sector which caused the PSX to climb. Institutional investors were key players in the market following the quarterly result announcements. Trading was dominated by the engineering sector at 39 million shares, followed by the textile and chemical sectors with volumes at 23.5 million and 25 million respectively.
Following the bull-runs on the market, especially in the last two trading sessions of the week, analysts are expecting the positive trend to continue on in the near-term which could possibly result in the market staying above the 42,000 points mark, and going higher. Investors are awaiting final word on the government’s decision to set up the market support fund for the revival of the market.
