Thursday, November 26, 2009
Tuesday, November 24, 2009
Monday, November 23, 2009
Thursday, November 19, 2009
Tuesday, November 17, 2009
Monday, November 16, 2009
Thursday, November 12, 2009
Wednesday, November 11, 2009
Monday, November 9, 2009
Friday, November 6, 2009
Pakistan equities witnessed a listless day today with the index struggling to sustain over 9,200. Although stocks traded in the positive territory for most part of the day, market slipped into red in the later half as broader market selling pressure dragged the index down. Talk of FII interest in Oil stocks namely PSO, POL and OGDC kept interest alive.
Although the market is devoid of any major triggers, inflation numbers due next week are likely to come down to a single digit figure that bodes well for equities. Moreover a possible rate cut in MPS later this month could revive investor confidence. Having said this, market is likely to follow political scenario with next couple of weeks expected to bring about major developments. Security situation and on going military campaign against terrorists are also expected to remain in focus.
Wednesday, November 4, 2009
Sharp drop in long term bond yields compared to last week (raised expectations of possible cut in the discount rate in the upcoming monetary
policy) triggered strong buying in the market. Market was also supported by positive developments on the political front with news of a possible deal amongst political allies to solve the NRO issue.
There was buying across the board with the banking and the energy sector leading the way. Top performers included MCB, UBL, PSO, HUBC and OGDC.
Volumes remained on the lower side with 108mn shares traded worth USD 89mn.
Pakistan equities recovered some ground on a dull trading session after yesterday's losses amid weak investor sentiment and concerns on political front. Nevertheless, most equities traded in green on local buying reportedly led by State Owned Institutions that accumulated stocks on weakness. Volumes remained thin with most activity in holding stocks JSCL and AHSL that closed down as investors switched to safer blue-chip havens. Oil stocks namely OGDC, PSO and POL and index heavy financials MCB and HBL kept the index in positive territory with some interest from FII's. It is worth noting that PPL again remained a laggard despite attractive valuations, downside protection and potential upside.
With market down over 9% in the last 12 sessions and support below 9k, we expect activity to pick up with FII flows key to the short-term direction.
Monday, November 2, 2009
Pakistan equities witnessed a decline of over 3% on fear of political crisis and deteriorating security situation. Key results announcement of PPL (1Q EPS PKR5/sh, inline) and NBP (EPS PKR3.5 for 3Q, below market estimates) in early trading failed to attract investor attention. Early morning bomb attack in Rawalpindi (near the Capital) added to investor anxiety with stocks seeing some support at 9000levels. In line with expectation market closely followed political developments and statement by MQM Chief (strong support in the financial capital Karachi) asking for Presidents resignation on the issue of NRO (that gives legal cover to many leading politicians) and to save the current democratic system led to equities tumbling to their lower locks. Major losers of the day included PSO, PTC, PPL, and ENGRO.
With earnings season over and market hunting for triggers, we expect politics to come to the forefront of attention. Talk of interim elections and fear of further political turmoil could set a bearish tone
Sunday, November 1, 2009
Pakistan equities traded range bound with index closing down 9 points at 9159 on concerns of escalating terror threat as military aggressively hunts terrorists in SWA region. Sentiment remains weak as local institutions follow a cautious approach and avoid taking fresh positions on the last day of the month. Hub Power HUBC PA, a defensive high yield play continued to decline as rumors of circular debt related issues (Non-Sharia i.e. Islamic compliance and fear of Islamic funds selling) did rounds. We disagree with any such argument and are of a firm view that stock is bearing the brunt of supply demand imbalance and strongly advise taking advantage of the current weakness. Lucky Cement's first quarter results that grew by over 14% to EPS PKR3.41 kept interest alive even though top line margins dropped by over 400bps. Moreover, PTC's quarterly earnings at EPS PKR0.5 that beat market estimates failed to cheer with stock closing negative.
Results over the weekend of PPL and NBP to be announced Monday morning prior to market open will set the tone early next week. We expect market to remain sensitive to successes on the ongoing military operation and political developments related NRO (National Reconciliation Ordinance that gives legal cover to many in the current administration). Furthermore, FII flows are also a key to the short-term direction of the market.