Karachi Stock Exchange Weekly Analysis 19 May, 2013

The Karachi Stock Exchange (KSE) benchmark movement was bullish. the bull rally was mainly driven by anticipated priority focus on the economy and the energy deficit post PML-N’s landslide election victory. KSE – 100 index closed at 2 0,537.03 points by gaining 620.76 points or 3.12 percent, while KSE-30 index has reached on 15,921.28 by gaining 483.69 or 3.13 percent. Average daily traded volume increasing by a stellar 67.1%WoW to 339mn shares.

PML-N Saturday emerged victorious by clinching 115 NA seats out of 272 general seats with a hope to form the next government in a 342-member parliament. Results till the filing of this report, PPP secured second position with 50 seats while PT bagged 33 seats, independents got 26, JUI-F 13, MQM 1, JI 1, PML-Q 1 and others 18.

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

  • PML-N has officialy selected the Senator Ishaq Dar as the federal finance minister
  • Planning Commission’s recommendation of reconsidering the allocation of gas to fertilizer sector, to ensure gas availability to the power sector
  • MSCI Inc. has deleted Pakistan State Oil (PSO) from MSCI Frontier Markets Index (MSCI FM) and added it to MSCI FM Small Caps Index. The removal of PSO, along with some other adjustments in weights for other stocks, has resulted in lowering of Pakistan stocks’ total weight in MSCI FM from 4.46% to 4.24% now
  • Possibility of resolution of circular debt pushed the oil giant PSO up by around 15.6%W/W
  • The joint venture of PSO and APL has won the bid for establishing a fuel farm and operation and maintenance of hydrant refueling system at the new Benazir Bhutto International Airport, Islamabad, stated a notice sent to the KSE
  • Moody’s eyeing key credit challenges for the new government
  • Forex reserves falling by US$ 262 million to US$ 11.6 billion
  • The market volumes were tilted towards the low cap stocks where FCCL, BOP, KESC, LPCL, TRG and BIPL generated hefty volumes
  • Cement stocks were in a rock & roll mood as majority of the cement stock outpaced the rest of the sectors
  • Right issue along with clean book of BOP backed by political support of PML‐N pushed the stock up by over 20%W/W
  • Anticipation of better business environment which can possibly push the credit offtake, fueled the rally in banking stocks during the outgoing week including ABL(+15.6%), MCB(+11.3%), UBL(+10.6%) and HBL (+7.8%)
  • Mansha Group’s stock performed exceptionally well in a post‐election scenario largely backed by political attachment with the incumbent ruling party
  • PSMC is expecting strong profitability in the later half of 2013 due to PKR20,000/ car increase in prices from January 2013 and incoming effect of weaker Japanese yen

Top ten gainers of last week were: B.O.Punjab, P.S.O., Allied Bank, Nishat Power, JS Bank, Lafarge Pakistan, Bank Of Khyber, Pace (Pak), MCB Bank and Sui North Gas Pipe.

Top ten losers of last week were: Shifa International Hospitals, Bata (Pak) Ltd., Agriautos Industries, Mari Petroleum, Grays Of Cambridge, Clariant Pakistan, Colgate Palmolive, Pak Tobacco Co, IGI Insurance and EFU Life Assur Ltd.

Top ten volume leaders were: FCCL, BOP, JSCL, PTC, KESC, BIPL, DGKC, LPCL, TRG and NBP.

Thank you very much for reading this article.

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

Written by: Rana Khurram

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