The dark shadows of political fallout rule the Pakistan Stock Exchange during the outgoing week where the index lost more than 1500 points where volume also dipped sharply because of lack interest of seasoned investors and financial institutions.
The week started off on a bearish note with index declining by 3.4 percent on week on week basis to close at 45,288pts. Anxiety over domestic politics heightened as ousted Prime Minister Nawaz Sharif kicked off a populist march while another prominent leader announced to hold sit in and rallies. The activity in local bourse remained dull amidst political noise as evident from a decrease of 46 percent on week on week basis.
Selling witnessed in the oil and exploration stocks as U.S crude futures for September delivery were down 0.76 percent at $48.20 a barrel, the lowest since July 26. Political situation is expected to keep market under pressure for as long as it doesn’t settle, which is why high net worth individuals, some of the mutual funds and banks adopted a cautious approach.
An analyst from BMAA capital said “we do not expect market to pick up its pace in the coming week and anticipate investors to remain cautious as foreign investors have been net sellers throughout the week”.
He added some local players have been net buyers but their quantum has not been able to pull the market in the green zone.
“We believe development on political front and earnings announcement will be the key trigger for market direction, where any positive surprise in earnings announcement will likely cause bulls to provide the much needed support to the index” he elaborated.
