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Uncertain political environment in the backdrop of ongoing Panama case and fresh wave of terrorist attacks in the country kept sentiments bearish at Pakistan Stock Exchange during the outgoing week ended on February 17, 2017. The benchmark KSE-100 index declined by 549.37 points on week-on-week basis and closed at the level of 49,375.71 points.

Trading activities on ready counter also remained low as average daily trading volumes declined by 14.5 percent on week-on-week basis to 353.91 million shares as compared to previous week''s average of 414.14 million shares. Average daily trading value decreased by 5.2 percent to Rs 17.62 billion. Total market capitalisation declined by Rs 83 billion to Rs 9.798 trillion.

However, foreign investors emerged net buyers of shares during this week. The foreigners bought shares worth $4.3 million during the week after a long selling spree witnessed since the start of the year.

An analyst at JS Global Capital said that volatility persisted throughout the week with index ultimately plummeting on week-on-week basis. Of the key sectors, key outperformers during the week were Insurance (up 3.7 percent) and OMC (up 2.2 percent). On the other hand, key heavyweights such as Banks (down 1.2 percent), Autos (down 0.8 percent) and Cements (down 0.8 percent) underperformed the broader index during the week. Apart from volatile security situation in the country, weaker than anticipated results during the week (especially Oil & Gas Development Company) contributed towards decline in index during the week.

An analyst at Arif Habib Limited said that a mixed trend was witnessed at the local bourse with levels above the psychological 50,000 mark seemingly untenable. Resistance became the underlying theme of the market given reservations over the ongoing Panama proceeding and in-house financing issues of certain brokers while a few fatal incidents disturbed domestic peace; the benchmark KSE-100 closing at 49,376 levels, down 1.1 percent on week-on-week basis. Pertinently, activity in certain sectors remained driven by market rumours; the Engineering sector came under selling pressure on market buzz regarding the grant of stay order on CRC''s anti-dumping duty circulated in the market. Meanwhile, the fertilizer sector displayed a lacklustre performance primarily owed to ENGRO which eroded 90 points from the index amid below street consensus payout announcement (Rs 4.00/share). Meanwhile, activity in other scrips was primarily result-driven; HBL remained the biggest weekly contributor to the market (51 points) owed to strong result outcome and MTL also attracted reasonable attention during the week.

Given limited immediate triggers, local individuals and banks sold portfolios worth $6.6 million and 4.6 million, respectively. On the other hand, foreign investors availed the opportunity and accumulated Pak equities resulting in a net buy for the week of USD 4.3mn vis-à-vis $5.4 million observed in the prior week.

BIPL weekly research report said that the index remained volatile during the week, breached the 50,000 level during intraday but failed to closed above 50,000 as the negative news flow and uncertainty kept the upside in check.

After starting the week positively, it was the rumours on stay order over anti-dumping duty on steel products which led to some heavy selling in scrips like ISL and ASL. However towards the latter half of the week, as the dust settled, the same stocks partially recovered their losses. The law and order situation in the country also played its part in making the investors'' cautious as 8 bomb blasts took place in the country in the space of five days, as a result of which volumes decreased. Furthermore, smooth resumption of hearing over Panama Leaks created a positive sentiment in the market.

Millat Tractors, along with its result, announced its plan of entering into the consortium setting up a Greenfield plant of Hyundai Motors which resulted in the stock closing on its upper circuit for the day. During the week, results of some blue chips were released which garnered mixed reactions from the investors. The HBL attracted positive flows after it posted an EPS of Rs 21.69 for CY16, while on the hand, the UBL moved into red after it posted an EPS of Rs 22.65 for CY16. In the cement sector, DGKC and FCCL posted an EPS of Rs 10.28 and Rs 0.94, respectively, for the first half of FY17, impact of which largely remained neutral on both stocks. Towards the end of the week, ENGRO posted its result for CY16, with a below expected divided of Rs 4/share, which led to some selling in the stock.



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