After having witnessed a handsome growth of 6 percent during the month of August the market took a breather in Sep-12 and went up by mere 1.3 percentMoM to reach at 15,444 levels. During the month, the market touched the highest level of 15,588pts, which happens to be 54 months high, said the analysts at InvestCap Research. However, the index failed to cross the all time high of 15,676pts and was down by 144pts from the above mentioned high of the month. Amongst the historical monthly average returns for the month of Sep, the KSE-100 remained low against its decade-average return of 2.5 percent for the month. The average daily volumes of the market also remained subdued during the month and reached at 146mn shares, down by 6.4 percentMoM as against 156mn shares recorded in the previous month. “The reason for stagnant behavior of the market during the said month was the conclusion of corporate results season for the period ended June coupled with uncertainty on relationship between the Gov’t and the judiciary which forced investors to adopt to a cautious stance and as a result market behavior remained sluggish during Sep-12,” viewed Mazhar A. Sabir, an analayst at InvestCap Reserach. On the other hand, he said, the market surged by 11.9 percent during 1QFY13, while on cumulative basis the market yielded superb 36 percent gain on year to date basis. The average return of the regional peer group stood at 5 percentMoM as against the benchmark KSE-100 index, as the latter inched up by mere 0.36 percentMoM (based on market Cap in USD) in Sep-12, whereas India yielded highest return of 13 percentMoM. On foreign inflow front, the FIPI in Asia pacific region stood at USD9.8bn with India achieving highest inflow of USD3.6bn during the month, followed by South Korea and Taiwan as they realized inflows of USD3.0bn and 2.05bn respectively. Pakistan on the other hand, received relatively low inflow of USD12mn during the month. However, the benchmark KSE-100 managed to secure position amongst top-5 regional indices on the basis of YTD growth (29 percent in USD terms), while beating MSCI World Index coupled with Emerging markets i.e. China, Taiwan, and Frontier Markets i.e. Vietnam and Sri Lanka. In 1QFY13, the KSE-100 sustained amongst the top-ten regional equities. Going forward, with the expectation of another rate cut in discount rate along with recently converted indices into free float based from market capitalization based seem positive steps for strengthen for the market. On the flipside, imbalances of macroeconomic indicators of the country coupled with uncertainty on political front, as the next elections are on the card which is expected to remain a hurdle for better market performance.
