Karachi Stock Exchange Weekly Analysis 22 January, 2012

The Karachi Stock Exchange (KSE) market movement was bullish with record high trades in last week. KSE – 100 index has reached 11,774.68 points by gaining of 760.22 points or 6.9 per cent. The KSE 30-share index rose by 731.21 points, or 7.18 percent, to 10,907.45. Please note that it is highest weekly increment since last 146 weeks (since April 3, 2009). According to analyst KSE index will breach psychological level of 12,000 points in next week.

Hopes of good news regarding CGT issues supported the market while positive revision in Pakistan economic growth estimate to 4 percent, recovery in global stocks, foreign interest in blue chips and statement issued by White House on US, Pakistan to work together to reset ties played a catalyst role in the bullish sentiment at KSE.

Average daily volumes increased by 209 percent to 87 million shares last week from 28 million shares traded in the week earlier. The market capitalisation surged by Rs190 billion to Rs3,056 billion. The daily turnover increased 456.69 percent to close at 178.42 million shares as against 32.05 million shares of the previous week.

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

  • SECP (Securities and Exchange Commission of Pakistan) has sent a proposal to Ministry of Finance pertaining CGT (Capital Gain Tax), WHT (withholding tax) and disclosure of source of income, has increased the confidence of investors
  • Global economic crisis and political uncertainty has also failed to dampen investors confidence
  • The news about KSE regarding the visit of Finance Minister (Hafeez Sheikh) on last trading day of week, has also made a positive impact in KSE market’s movement
  • Foreign Portfolio Investors have offloaded shares of worth $3.7 million, according to NCCPL (National Clearing Company of Pakistan Limited)
  • The Government of Pakistan has decided to settle circular debt of Rs. 150 billion by issuance of TFCs (Term Finance Certificates)
  • The raid by Competition Commission of Pakistan (CCP) at All Pakistan Cement Manufacturers Association (APCMA) office has made cement stocks under pressure
  • Banks and electricity sectors has underperformed the market by 2.8 per cent and 3.6 per cent respectively
  • Political noise will shift down the gear and corporate results around the corner. Fundamental earnings would dictate movement of stock index next week

I.C.I Pakistan Ltd., Oil & Gas Dev.Co, Lafarge Pakistan Cement Ltd, Engro Corporation Limited, Engro Foods Ltd., Fauji Fertilizer Bin Qasim, Pakistan Telecommunication, Nishat Mills Ltd., National Refinery Ltd., Attock Refinery Ltd., Nishat (Chunian) Limited. were major gainers 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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