Earlier in the week, sentiments were supported by Prime
Minister’s industrial relief package, coupled with record high monthly exports
of US$3.06 billion during January 2026, resulting in 7%YoY drop in trade
deficit. Inflation reading during the month remained lower than expected at
5.8%YoY.
Cement sector’s offtakes hit 5-year high of 4.54 million
tons, up 13%YoY, driven by higher sea-exports.
OMC offtakes also increased by 6%YoY to 1.35 million tons.
Banking sector deposits expanded by 0.7%WoW, providing a
positive backdrop for the sector.
T-Bill and PIB yields rose by 15 to 40 bps, in the first
auction following SBP’s decision to leave policy rate unchanged.
Despite improved sentiments, market participation weakened
during the week, with average daily trading volume declining by 12%WoW to 1.2 billion
shares, from 1.4 billion shares in the earlier week.
On the currency front, PKR appreciated by 0.02%WoW against
the greenback during the week, closing the week at 279.71 PKR to a US$.
Other major news flow during the week included: 1) UAE rolls
over US$2 billion Pak loan for a month, 2) GoP requests Saudi Arabia for
two-year extension in oil facility, 3) Barrick reviews Reko Diq project amid
security concerns, 4) FBR collection rose 16%YoY to PKR1,015 billion in January
2026, and 5) Private sector credit expands by PKR 589 billion in FYTD.
Power Generation & Distribution, Jute, Leather &
Tanneries, Inv. Banks/ Inv. Cos./ Securities Cos., and Real Estate Investment
Trust were amongst the top performing sectors, while Chemical, Engineering,
Tobacco, Oil & Gas Exploration Companies and Cement were amongst the laggards.
Major buying was recorded by Mutual Funds, Brokers, and
Companies with an aggregate net buy of US$32 million. Banks and Foreigners were
major sellers with net aggregate sell of US$25 million.
Top performing scrips of the week were: KEL, ILP, SAZEW, HMB,
and TRG, while laggards included LOTCHEM, PIBTL, PPL, GADT, and KTML.
AKD Securities foresees the positive momentum at PSX to
continue due to improving macros and continuous focus on reforms amid political
stability. The brokerage house forecasts the benchmark Index to reach 263,800
by end December 2026.
Investors sentiments are expected to improve on the
likelihood of foreign portfolio and direct investment flows, driven by improved
relations with the United States and Saudi Arabia.
Top picks of the brokerage house are: OGDC, PPL, UBL, MEBL,
HBL, FFC, ENGROH, PSO, LUCK, FCCL, INDU, ILP and SYS.
