The positive momentum was driven by conclusion of trade deal
between the United States and Pakistan including focus on developing Pakistan’s
oil reserves, coupled with officials commenting that government is all set to
disburse the PKR1.3 trillion amount, secured from commercial banks, by next week.
This triggered gains in the E&P and OMC sectors. The
said development overshadowed the subdued performance of initial days over monetary
policy committee (MPC) announcement uncertainty, in which MPC maintained a
status quo on policy rate over inflation concerns.
Despite the index’s upward momentum, market participation
declined, with average daily traded volumes falling 11.6%WoW to 562 million
shares, compared to 635 million shares a week ago.
On the macroeconomic front, US announced reduced tariffs on
Pakistani exports at 19%, down from the previously imposed 29%.
Headline inflation for July 25 inched up to 4.1%YoY, as
compared to 3.2%YoY a month ago.
Pakistani Rupee appreciated for a second consecutive
week by 0.26%WoW, supported by government efforts to curb down on the illicit
Fx market.
Foreign exchange reserves by State Bank of Pakistan (SBP)
declined by US$153 million to US$14.3 billion as of Jul 25, 2025.
Other major news flow during the week included: 1) FBR collected
PKR755 billion against a target of PKR748 billion, 2) Yarn, grey cloth, raw
cotton removed from EFS purview, 3) SBP bought US$6.7 billion from the
interbank market in 10MFY25, 4) GoP imposed PKR238/ mmbtu levy on gas for captive
power plants, and 5) GoP slashed petrol price but hiked high-speed diesel.
Jute, E&P, and OMC were amongst the top performing
sectors, while Vanaspati & allied industries, Woollen, and Property were
among the laggards.
Major selling was recorded by Banks and Foreigners with a
net sell of US$5.0 million and US$4.5 million, respectively. Mutual funds
absorbed most of the selling with a net buy of US$10.9 million.
Top performing scrips of the week were: BWCL, OGDC, SYS, PPL,
and PSO, while laggards included: EPCL, BNWM, JVDC, PSEL, and MEHT.
According to AKD Securities, PSX is expected to remain
positive in the coming weeks, with further developments over circular debt
expected to drive the market along with upcoming corporate results.
The benchmark index is anticipated to remain on upward
trajectory, with a target of 165,215 points by end December 2025.
Market will be primarily driven by strong earnings in Fertilizers,
sustained ROEs in Banks, and improving cash flows of E&Ps and OMCs,
benefiting from falling interest rates and economic stability.
Top picks of the brokerage house include: OGDC, PPL, PSO,
FFC, ENGROH, MCB, HBL, FCCL, KOHC, INDU, and SYS.
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