Karachi Stock Exchange Weekly Analysis 13 November, 2011

The outgoing week saw only two trading sessions against the usual five sessions due to holidays on account of Eid and Iqbal Day. The Karachi Stock Exchange (KSE) market activity was bullish. KSE – 100 index has reached 12,038.93 points by gaining of 81.63 points or 0.68 per cent. The KSE-30 Index surged by 90.41 points, or 0.80 percent, to close at 11,382.98 points. The Karachi Stock Exchange (KSE) is expected to maintain buying momentum next week on trading in energy, banking and fertiliser stocks ahead of the next monetary policy due this month.

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

  • Faisal Rajab Ali, a stockbroker, expects a cut of 50 basis points in the discount rate in the next monetary policy
  • Positive sentiments were witnessed on support from energy and oil sectors on hopes of early resolution of circular debt on $2 billion support from World Bank and Asian Development Bank
  • Restructuring of T-bills and meeting of Indo-Pak leadership also supported the market
  • The restoration of gas supply to Engro Corporation for 15 days may invite fresh buying in the fertiliser stocks
  • Any development on the government move to convert circular debt in the power sector into the government securities would accordingly invite buying in power, energy and banking stocks
  • Oil and Gas Development Company, Pakistan Petroleum Limited, Pakistan Oilfields, Pakistan State Oil, MCB Bank and the National Bank of Pakistan would be the major beneficiaries of resolution of the circular debt issue through adopted strategy
  • The ongoing week, therefore, recorded buying in energy, banking and fertiliser stocks due to the discovery of oil and gas reserves in Nashpa fields in Kohat and a large size gas discovery in Zin Block
  • The average weekly turnover, however, fell by 40 percent to 44 million shares due to low participation of investors. The overall market capitalisation increased by 19 billion to Rs3,135 billion

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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