KSE likely to perform well next week

KARACHI: The Karachi Stock Exchange (KSE) witnessed positive trend during the week ended on Friday with a huge increase of 336 points amid speculations of increased foreign investment in the market, said dealers.

Hasnain Asghar Ali, chief operating officer of Escorts Capital, said that the stock market would also perform well next week as banking, cement and oil companies are already performing well, while it is likely that the fertiliser sector also come in the limelight.

An analyst at the KASB Research said that investors come out of cautious mode after peaceful Ashura holidays. Pakistan-US ties also eased, which provided support to the KSE-100 index which surged to an all-time high of 16,574 points. The rally was also enjoyed by foreign investors, which injected $6.7 million in the exchange, while volumes improved further by 16 percent on a week-on-week basis, he said.

The index heavyweights, particularly in the banking sector were finally able to lure interest due to anticipation of robust payouts along with full-year results. Nonetheless, second- and third-tier stocks continue to dominate throughout the week.

Overall the KSE-100 index gained 336 points against last week to close at 16,574 points from16,238 points level. Average volumes too improved to 312 million shares from 253 million shares, while foreigners bought shares worth $6.7 million against $5.7 million last week.

Grays of Cambridge, Bata (Pakistan), KESC and Engro Foods Limited were the major gainers, while Pak Cables, Pace (Pak) Ltd, Kohinoor Energy, Allied Rental Modaraba and Pak Suzuki Motors were major losers.

Samar Iqbal, an equity dealer at Topline Securities, said that in anticipation of lower inflation for the month of November and further monetary easing kept the local bourse in the bull run.

The market gained by two percent on week-on-week basis with average volumes showing a healthy rise of 37 percent to Rs6.3 billion.

Investors remained bullish in cement stocks, while textile sector also joined the bandwagon, as investors were hoping better earnings of the sectors amid better margins, she said.

The buyback announcement from the Unilever management brought the stocks in the limelight as investors anticipated the deal to be struck at a higher level, while investors’ interest was also seen in other consumer stocks such as Nestle and Engro Foods. Renewed interest in the banking sector was also witnessed before the end of the year.

Unilever Pakistan applied for voluntary delisting from all three stock exchanges of Pakistan and suggested a minimum share price of Rs9,700 per share to buy all its shares from the investors in the stock market. Such a decision invited interest of the buyers, who purchased major shares of Unilever Pakistan and its share price surged beyond Rs10,000 per share.

However, Unilever said it is not winding up from Pakistan rather it plans to invest more in the country.

According to a letter of the Unilever Pakistan addressed to all the three stock exchanges, Unilever Overseas Holdings Limited, United Kingdom, which currently holds over 75 percent shares of Unilever Pakistan has decided to acquire all the remaining outstanding ordinary shares in Unilever Pakistan Limited and seeks delisting of the shares of Unilever Pakistan from all the three stock exchanges of Pakistan.

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