Staff Reporter Karachi
Stocks are likely to remain range-bound during this week due to results season and improving exchange rate despite passive foreign inflows and ongoing third wave of Covid-19.
Analysts expect corporate earnings to be the major focus for investors in the week ahead, as they evaluate whether rising costs are squeezing margins and signalling a build in inflationary pressures.
Shaukat Tarin’s appointment as new finance minister is most likely to be welcomed by investors at Pakistan Stock Exchange (PSX).
Strengthening rupee, stable external position, result season, and world stocks marking a record high in the entire history of global financial trading are strong indicators that the index may move to the north.
Analysts at Arif Habib Limited said that the market will remain bullish in the upcoming week.
“With the commencement of result season, we believe oil and cyclical sectors will be under limelight on the back of healthy earnings expectations.”
Additionally improvement in macroeconomic indicators and appreciation of PKR/USD parity will keep investors’ sentiments positive.
However, any further increase in domestic Covid-19 infection ratio may dampen investor’s sentiments, they said.
Foreign selling continued last week clocking-in at $1 million compared to a net sell of $9.5 million preceding week. Selling was witnessed in all other sectors ($2.64 million) and commercial banks ($1.31 million).
On the domestic front, major buying was reported by individuals ($9.77 million) and other organisations ($ 3.9 million).
It is expected that rupee/dollar parity will remain strong. The foreign reserves held by the country have increased to 23,179.4 million.
According to the central bank, its reserves have reached $16,027.20 million, showing their highest level since July 2017.
On the other hand, the foreign exchange reserves held by commercial banks stand at $7,152.20 million.
