PSX: a week in review

KARACHI: The stock market had a relatively stable performance for the week of August 14. The transition to an interim caretaker setup contributed to the market’s limited movement. The announcement of significant increases in petrol and diesel prices further dampened market sentiment.

The fiscal year deficit reached Rs6.5 trillion, equivalent to 7.7 per cent of GDP. The central government debt rose by 3.3 per cent to Rs60.8 trillion as of June 2023. The State Bank of Pakistan’s foreign exchange reserves saw a $12 million increase, reaching $8.1 billion.

Meanwhile, the rupee depreciated against the dollar during the week, closing at 295.78, a decline of 2.46 per cent compared to the previous week. As a result, the benchmark index of the stock market concluded at 48,218 points, marking a decrease of 206 points or 0.4 per cent from the previous week.

Several sectors experienced negative contributions, including commercial banking, fertiliser, cement, chemicals, and exploration and production. However, technology and textile composite sectors made positive contributions.

Individual company stocks also had mixed performances. Engro Corporation Ltd, Oil and Gas Development Company Ltd, MCB Bank Ltd, Meezan Bank Ltd, and Habib Bank Ltd experienced declines, while Systems Ltd, Pakistan Petroleum Ltd, Nestle Pakistan Ltd, Thal Ltd, and Interloop Ltd saw positive contributions.

Despite potential volatility due to IMF conditions and upcoming general elections, the stock market is anticipated to maintain a positive trajectory in the coming week, aided by a smooth transfer of power to the caretaker setup. However, market performance could remain unstable, partially cushioned by bilateral/multilateral inflow commitments and healthy reserves.