Karachi Stock Exchange Weekly Analysis 1 August, 2010

Karachi Stock Exchange (KSE) has performed very well last week and witnessed a bullish trend last week and crossed the psychological level of 10,500 points. The Karachi Stock Exchange (KSE) 100-share index closed at 10,519 points by increment of 223 points or 2.2 percent. But the upcoming week especially Monday is expected to be under pressure, because State Bank of Pakistan (SBP) has announced its Monetary Policy and increased 50 basis point in discount rate and led it to 13 percent.

Following news have played vital role in Karachi Stock Exchange (KSE) index movement:
  • As the corporate result season has arrived, with the implementation of margin trading system will recover the market
  • Decent results have been announced last week e.g. HBL, FFC, FFBL, ENGRO
  • Fertilizer sector have announced nice results, because urea and DAP prices were increased, which led them to better then expected earnings
  • Lapse of 15 percent regulatory duty on export of yarn have created an interest of investors in textile sector
  • There is rumour that PSO will receive Rs. 15 Billion from ministry of Finance, and better results of PSO are also expected. That’s why investors are showing interest in PSO also
  • Foreign investors have also invested $12.68 million
  • Foreign minister have assured the dispatch of $3 billion from Friends of Democratic Pakistan
  • Acquisition of RBS by FABL is finalized
  • Manzalai field oil production increase to 4,800 bpd
Beside these positive news, there are some reasons for which we recommend investors to be careful
  • Increase in rate to 13 percent in Monetary Policy of SBP, have really hurt the sentiments of investors, and local investors/institutions will expect to be very careful in next week
  • Uncertainty in Global Stock Markets
  • Fall in International Crude Oil Prices and reaches $77 per barrel
  • Target killing, law and order situation and Flood in different parts of country
  • Lucky cement has temporarily stopped production, because of serious clashes between to labour groups
  • Power tariffs have raised by Rs. 0.64 per unit
LOTPTA, BAFL, OGDC, PTC, BAFL, ENGRO, FFC, FFBL, Fatima Fertilizer, PSO, MCB, PPL were on top at KSE last week.

NOTE: The information posted in this blog (forum) is based on current afairs & invstors point of view. There may be discrepancy in the ground realities.

Written by: Rana Khurram

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