PSX likely to continue with lack-lustre, range-bound performance

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Karachi

The Pakistan Stock Exchange (PSX) is likely to con-tinue with range-bound activity in the week starting today (Monday) after two successive weeks of lacklustre and range-bound performance.

However, the factor of result seasons may keep the PSX away from plung-ing, which was witnessed on Friday last, and there is expectation that the market will remain in the green zone at the start of the week.

However, analysts are divided over the behaviour of the market. Analysts at Arif Habib Limited expect the stock market will pick up pace next week.

“The results season is about to com-mence and we think that cyclical sec-tors can once again attract the lime-light on the back of robust economic activity,” they said.

Moreover, oil prices have continued to remain downwards sticky with no out-come on the oil output increase, which could spur buying in E&P scrips.

How-ever, fears over the fourth wave of the Covid-19 pandemic could keep the sentiments under check.

JS Global conducted a webinar last week to present the “Stock Market Monthly Outlook” which noted that the target of petroleum levy for the fis-cal year 2021-22 and international ris-ing oil prices are likely to continue pressuring the inflation numbers which will ultimately fuel the selling pressure across the local bourse.

During the previous months, the mar-ket witnessed positive sentiments on the back of resumed economic activi-ties after lifting the lockdown situa-tion.

However, the spread of new delta variant will likely take the economy towards widespread lockdowns which would keep the market consolidated.

The benchmark KSE-100 Index index shed 0.25 percent, or 122.73 points, to close the week ended July 9, 2021 at 47,563.45 points. The KSE-30 shares index gained 0.05 percent, or 10.43 points, to close at 19,110.87 points.

The overall activity on the bourse dampened during the last week, as av-erage traded volumes declined 22 per-cent to 486 million shares/day, while the average value of traded securities settled at $107 million, down 1 per-cent.

Foreign selling continued during the outgoing week, clocking-in at $5.2 mil-lion, compared with the net selling of $8.4 million last week.

On the news front, the auto manufac-turers slashed car prices across-the-board and announced to pass on the impact of the reduction in the federal excise duty to the customers.

In the light of the rising international com-modity prices, the local players in-creased the prices of rebars.

Similarly, prices of DAP were also increased do-mestically to pass on the international surge in prices. — TLTP

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