Market participation improved, with average daily traded
volumes rising by 34.6%WoW to 662 million shares, up from 492 million shares a
week ago.
The IMF concluded its staff mission last week on the Federal
Budget FY26, stating that discussions on the upcoming budget proposals were
constructive, while further deliberations will continue.
GoP raised PKR720 billion from T-Bills auction, with cutoff
yields for 6-month falling to 11.18%, which was at a 38-month low.
China has assured Pakistan of US$3.7 billion in refinancing
in June 2025, which will facilitate Pakistan to meet IMF's foreign exchange
reserves target of US$14 billion by the FY25 end.
The government is reportedly close to finalizing a financing
agreement aimed at retiring circular debt in the power sector.
PKR depreciated marginally by 0.02%WoW to close at
282.02/US$.
Foreign exchange reserves held by State Bank of Pakistan (SBP)
increased by US$70 million to a 19-week high of US$11.5 billion.
Other major news flow during the week included: 1) Weekly
inflation recorded a decline of 0.81%, 2) FBR to levy 18% sales tax in
FATA/PATA region, 3) GoP considering exempting import of equipment and machinery
for up-gradation of refineries under Brownfield Refinery Policy, 4) GoP
considering reduction of GST on packaged milk, and 5) SBP raised PKR187 billion
through floating rate PIBs.
Jute, Textile Weaving, and Paper & Board were amongst
the top performing sectors, while Automobile Assembler, Transport, and Food
& Personal Care were the laggards.
Major selling was recorded by Foreigners with a net sell of
US$5.6 million. On the other hand, Brokers and individuals absorbed most of the
selling with a net buy of US$6.4 million.
Top performing scrips of the week were: KTML, PKGP, KEL, PTC,
and APL, while laggards included TPLRF, RMPL, GADT, SAZEW, and AGL.
According to AKD Securities, market is expected to remain
positive in the coming weeks, with developments around the upcoming federal
budget likely to drive short-term sentiment, along with room for rate cut in
the upcoming MPC meeting as forecast for FY26 inflation at 7.0%.
The benchmark index is anticipated to sustain its upward
trajectory, 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, MEBL, MCB, HBL, LUCK, FCCL, INDU, and SYS.
