Weekly review: Index continues northward ride amid some concerns

KSE gained 263.83 points during the week, but remittance and exports data cause worries

KARACHI: Despite a two-day holiday, the KSE-100 Index continued to add points to its already historic highs, gaining 263.83 points or 0.64% week-on-week to finish at 41,464.31 points.

The index ended positive in all three trading sessions, but under different circumstances as Monday saw across-the-board interest before profit-booking erased almost all gains on Thursday. A negative start, however, ended positive on the last trading day of the week as the index treaded carefully but steadily upwards.

Car sales data attracted investors towards the automobile sector with banking stocks remaining among the favourites this week. Talk of a freeze on crude output meant the oil and gas sector remained in the limelight with prices hovering around the $50 per barrel mark.

However, macroeconomic indicators continued to be a worry. A widening trade deficit and falling remittances meant economic managers have much to be concerned about. With recommendations of currency depreciation making the rounds and local cement sales showing a slowdown in growth, investors are likely to remain cautious.

Rising oil and coal prices meant that one of the key ingredients pushed the cost of producing cement up, cutting into industry profit. Telecom and gas utilities too witnessed slipping share prices in the week.

The already contentious issue of balance of payments became all the more compounded with the remittance data for the first quarter (Jul-Sep) showing precipitous drop of 5% - and even a more alarming 9% drop for September.

The overall activity also tumbled during the week as average traded value and volume clocked in at $132 million (-19% WoW) and 404 million shares per day (-33% WoW), respectively.

Breaking the sixth week bearish streak of foreign selling, the foreign investors were net buyers this time round with net purchases of $2.2 million.

Winners of the week

Crescent Steel



Crescent Steel and Allied Products Limited manufactures steel lined pipes and multi-layer pipe coatings, which are used for water, oil and gas transmission. The company also has a cotton division that manufactures cotton yarn.

Philip Morris Pakistan



Philip Morris Pakistan Limited manufactures and sells tobacco
and cigarettes.

The Bank of Punjab



The Bank of Punjab (Pakistan) operates under the status of a scheduled bank in Pakistan. The bank provides commercial banking services.

Losers of the week

Sui Southern Gas



Sui Southern Gas Company Limited transmits and distributes natural gas, and constructs high pressure transmission and low pressure distribution systems. The company’s transmission system extends from Sui in Balochistan to Karachi.

Service (Shoes) Industries



Service Industries Limited specialises in the manufacturing of tyres and tubes for motorcycles, bicycles, rickshaws and trollies. The company also produces footwear.

Hum Network



Hum Network Limited operates satellite television channels. The company operates a channel targeted primarily at women, one about food and one that covers lifestyle and entertainment.

Published in The Express Tribune, October 16^th, 2016.

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