Karachi Stock Exchange Weekly Analysis 2 October, 2011

The Karachi Stock Exchange (KSE) market activity was bullish. KSE – 100 index has reached 11,761.97 points by gaining of 151.11 points or 1.33 per cent. The reasons for investors to remain active were hopes of improvement in ties with the US, recovery in global commodities, highs in refineries margins, urea offtake hitting a record-high level and expectations of decline in the State Bank of Pakistan’s interest rate to be announced next week.

Following news have played vital role in Karachi Stock Market index movement:

  • High geo‐political tensions revolving around Pak‐US relations were on display early in the week however the situation gradually improved, which combined with hopes of monetary easing allowed a return of investor participation and risk appetite
  • According to experts, The Karachi Stock Exchange (KSE) is likely to continue to rise in the coming week on expectations of discount rate cut, which will improve the dividend yield of many stocks and benefit leveraged listed firms. SBP (State Bank of Pakistan) is schedule to announce the monetary policy for next two months on 8 October, 2011
  • Aug‐11 Fertilizer Sales: urea up 84%, DAP up 53% YoY. Fatima Fertilizer, Fauji Fertilizer Bin Qasim (FFBL), Fauji Fertilizer Company and Engro Corporation remained in the limelight as it was reported that urea production rose 11 percent in August
  • According to analysts, Attock Group companies could see a jump in value in the next few sessions as investors start trading shares ahead of dividends delivery. And Oil and Gas Development Company Limited (OGDCL) and Pakistan Petroleum Limited (PPL) closely followed the fluctuation in international crude oil price. Any spike is sure to push up these stocks
  • Some of the listed companies are also expected to start announcing their July-September 2011 quarterly results from mid of October, raising hopes of another results-led rally
  • Senior KSE officials have maintained that the Federal Board of Revenue (FBR) is due to review the capital gains tax (CGT) issue sometime in October
  • IMF (International Monetary Fund) team to arrive on Oct 10th for Article IV Consultation
  • PSO (Pakistan State Oil) seeks Rs50 billion urgent payment
  • Govt cut NSS rate by 80-96bps
  • Petrol, CNG prices likely to rise by Rs4/liter in Oct-11
  • FAO says 70% Sindh crops damaged due to floods
  • INDUS motor increases car prices by Rs30,000-50,000
Agritech Limited, Siemens Engineering, Dawood Hercules, Gharibwal Cement and Lafarge Pakistan Cement Ltd were the major gainers while PICIC Growth Fund, Grays Of Cambridge, P.I.A.C. (A), Indus Motors and Pace (Pak) Ltd were major losers at KSE this 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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