Pakistan equities witness a disappointing start to the week – Elixir Research
By: Fareesa Baig,
Elixir securities Pakistan (Pvt) Limited
Pakistan equities plunged more than 400 points and managing to hit a recent all time low at 21,678 points as confidence remains weak despite rebound in regional markets. Leading the decline were index heavy MCB Bank MCB PA -3.8%, Oil and Gas Development OGDC PA -1.7% and Engro Corp ENGRO PA -3.4%, while weekend news of tax evasion probe of a Karachi based broker further fueled the negativity. However, Supreme Court order setting a 30 day deadline for the auction of 3G telecom licenses brought Pakistan Telecom PTC PA -0.1% to the limelight. Cements continued to be under pressure, with small and mid caps to the likes of Kohat Cement KOHC -5% and Maple Leaf MLCF -4.9% at their respective lower locks while Lucky Cement LUCK PA +0.7% managed to stay buoyant most of the day. CPI inflation numbers clocked in slightly above estimates at 8.55% but had no significant impact on broader market sentiments, while investors continue to look forward to the upcoming monetary policy announcement.
Thin volumes and recent losses are hurting retail players the most while institutional investors continue to follow wait and see till further clarity on direction. Monetary policy announcement remains a key event to look forward to in absence of any major news or results in days ahead. Having said this, foreign inflows can act as a serious catalyst and can swing momentum in favor of bulls.