Karachi Stock Market Weekly Analysis Dec 26, 2009

Karachi Stock Exchange – 100 index has crossed psychological level of 9,400 points last week. KSE – 100 Index has closed at 9,422.23 points by increment of 238.50 points at the rate of 2.59 per cent, and its parallel running junior KSE -30 has closed at 9,903.13 points by increment of 250.23 points at the rate of 2.59 per cent. Remember this is highest level achieved during last two months. The bullish trend is also expected in upcoming week.

Following positive news have triggered market:

  • Financial results announcement season has arrived, and positive results/reports are expected.
  • Political uncertainty, instability and volatility have getting settled, which was increased after CJ decision of NRO. PML (N) has withdrawn their demands of resignation from Asif Zardari.
  • IMF has approved the release of fourth tranche ($1.2 billion of its total $11.3 billion) of its standby loan to Pakistan.
  • Heavy buying was witnessed in Energy, Banking, Fertilizer and Cement sectors e.g. OGDC, PTC, NBP, FFC, DGKC, and Adamjee Insurance
  • OGDC, British Petroleum and MOL have got permission for seismic survey at six places.
  • International Oil prices have increased, so investors have opted to take decent positions in E&P sector.
  • There are news circulating related to BOP, that Harris Steel Mills has to recover 7.5 billion rupees loan.
  • Textile sector is also doing well, because there is much better cotton crop yield this season.
  • Adamjee Insurance and NML are getting into an agreement, to acquire AES Lalipur and AES Pak Gen Power.
  • A good news for Cement sector is that, China has sanctioned a grant of $700 million grant for the construction of 32 small dams on different parts of country.
  • Nice investments have recorded by NCCPL from Foreign Portfolio Investors in blue chips.
  • SPI declines by 0.26% WoW.

Along with these positive news, there are also some negative news which have adversely affect market e.g.:

  • By January, 2010 electricity tariff are getting increased up to 13.6 per cent and Gas up to 18 per cent.
  • Load shedding of Gas has also been started.
  • Terrorist activities throughout the country.
  • Government (Ministry) has not finalized ex-refinery pricing formula, because of the failure of consensus.
  • State Bank has declared that NPL (Non Performing Loans) of Banks and DFI’s have surged to a new peak level of Rs.435 Billion.

OGDC, NCL, PTC, NBP, BOP, FABL, BOK, FFC, DGKC, and Adamjee Insurance, AH Securities were on top last week.

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

Written by: Rana Khurram

Karachi Stock Exchange Weekly Analysis December 19, 2009

As was predicted and expected, Karachi Stock Market has revived and bullish trend continues. Especially at the start of last week (Monday 14 Dec, 2009) market has recovered three percent and 243 points and closed at 9,280 points. But in other days of week, market move was mixed and varied. Some local investors had adopted profit selling because of some negative news e.g.

  • Suicidal blasts e.g. D.G Khan and other parts of country has created a chaos
  • Political turmoil has been created after Supreme Court decision about NRO
  • USD $ has reached highest value in the history i.e. 84.47 PKR

After these activities KSE – 100 index closed at 9,183.73 points after the increment of 143.43 points or 1.62 per cent and KSE – 30 index was closed at 9,652.90 after the increment of 156.80 points or 1.65 per cent.

There was also some positive news which has ignited market index e.g.

  • Abu Dhabi provides Dubai $10 billion in bailout money
  • CJ has declared NRO null and void
  • Foreign investors have invested in Banking sector massively
  • In next week positive reports/results are expected
  • Consensus of all four provinces on NFC award
  • Approval of Austerity plan
  • $1.46 billion aid for Pakistan has been approved by US Congress
  • Improved trade and current account deficits
  • Turnaround in the LSM (Large Scale Manufacturing) growth
  • Huge remittances have been sent by overseas Pakistanis.

Some analysts and investors have stated that if government fails to control over suicidal attacks and political instability increases (because of NRO and other issues), then market index may be dull, volatile and lacklustre. There are also upcoming holidays of Christmas, Ashura, year ending etc. which can effect market movement. On the other side there are so many positive news (as mentioned above) which can trigger market to upside moves. We recommend all investors to be careful in any investment.

BAFL, BOP, JSCL, NML, PTC, PACE and AHSL were on top last week.

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

Written by: Rana Khurram

Karachi Stock Market Weekly Review Dec 14, 2009

During last three working days, Karachi Stock Exchange back and showed a bullish trend. Although in first two days of last week, market was dull and lacklustre. But in last three days, market has revived and was succeeded on maintaining psychological level of 9,000 points. On the end of last week, KSE - 100 index has reached 9,037.30 points on the increase of 28.17 points or 0.31 percent, and its parallel running junior KSE – 30 index was on 9,496.10 points, after the increment of 31.97 points or 0.33 per cent. Remember KSE 100 – index was closed at 9,009.13 points and KSE – 30 index was on 9,464.13 points on closing of first week of December (4 December, 2009).

As we have discussed earlier that market was dull and volatile since Eid, and was also in first two days of last week. Following are the key factors for this decline:

  • Supreme Court had started hearing cases related to NRO, and other corruptions. Highly influenced personalities including President are involved in these cases.
  • Debt de
    Publish Post
    bacle emerged in Dubai since Eid had shook the financial markets globally and also affected our local market.
  • In almost all parts of country there is a depressing law and order situation, terrorist activities etc.

But in the middle of last week we have found some positive activities which have ignited the index and market had started the revival. According to analyst if market will show persistence and Government will reform all above mentioned issues, then hopefully KSE – 100 index will reach a benchmark of 9,800 points at the end of December, 2009. Following are the important triggers which causes market revival:

  • Dubai financial markets have recovered up to 7 per cent, and Global financial markets have started rebound.
  • increase in local oil and gas productions
  • In its Annual Sovereign Report, Moody’s Investor Service has rated “B3” and given a stable outlook to Pakistan.
  • Positive inflow on Manzalai production and increased remittances flow in November 2009 ($742 million)
  • Strong valuations in bank, fertilizer and textile scrips. And there are positive activities are witnessed in Banking, Investment and Insurance sectors, because they are near on closing financial year. And positive results are expected especially NBP, ABL, and MCB etc.
  • A meeting of IMF Executive Board to finalize the fourth tranche of $1.2 billion to Pakistan in December.
  • Government is planning to launch National Savings Bonds on local stock exchange during current month.
  • BOP (Bank of Punjab) is doing well, because there were news on recovery of bad loans, and Ex-President Hamesh Khan has also been arrested in US, some other defaulters (e.g. Sheikh Afzal, Harris Afzal, and others) were already arrested, which were accused of corruption of Billions of Rupees.

We recommend all investors, that it is best time of buying. Because almost all sectors are now on very reasonable prices, and have touched their possible low ranges. Invest at your own risk and after thoroughly reviewing all possible aspects, history, quarterly reports etc.

Arif Habib Bank, NCL, JSCL, PAKRI, BAFL, OGDC, PSO, PPL, KESC, Fauji Fertilizer, DGKC, LUCK, were on top last week.

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

Written by: Rana Khurram

Karachi Stock Exchange Weekly Analysis December 06, 2009

As the sequel of previous week’s decline of Karachi Stock Exchange, this week’s trend was also bearish. The KSE 100 - index sheds 197.08 points or 2.14 percent and closed at 9,009.13 points, KSE 30 - Index decreases at 2.49 percent or 242.35 points and closed at 9,464.13 points.

Following important factors have caused market decline:

  • Debt debacle that emerged in Dubai last week shook the financial markets globally
  • Foreign Portfolio Investors were major net sellers and offloaded shares worth $5.3 million
  • Security concerns, terrorists activities, bomb blasts throughout the week, grim law and order situation have hurt the sentiments of investors
  • Uncertainty and Political turmoil, due to NRO and other issues
  • Local Investors are very cautious for buying, especially in Banking and Telecom sectors
  • Fall in International oil prices and investors’ concerns over circular debt issue affecting oil refineries cash flows
  • High government borrowing, growing liabilities’ ($55 billion), reservations regarding achieving revenue and export targets and likely rising trend in inflationary pressures
  • uncertainty over future commodity prices, high leverage cost

There is no positive trigger in this month; investors are very careful and cautious in buying. In next week (from 7 Dec, 2009), Supreme Court will start to hear cases related to NRO, which is also against government. So market may remain dull and volatile. BOP, Silk bank, Bank Al-Falah, OGDC, Pak Refinery, JOVC, PASL were major performers of last week.

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

Written by: Rana Khurram

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