Karachi, August 26, 2022 (PPI-OT): Market turned negative over political noise

Increased political noise and devaluation of Rupee against US$ (-3% WoW) led to profit taking this week. The week started with political noise over the possibility of former prime minister’s arrest in the foreign funding case. KSE100 index closed on a negative note at 42,591, losing 679 points WoW. Volumes declined by 52% with 250 million shares traded during the week. Key underperformers were OMCs (-4%), Refinery (-3%) and Engineering (-3%) while Cement (0.4%), and Fertilizer (0.2%) outperformed the benchmark. During the week, SBP kept the Policy Rate unchanged.

Moreover, Brent oil prices recovered by 5.1% to US$100.55/barrel as fears of a global slowdown subsided. On the news front, Qatar announced an investment of US$3bn in different sectors of Pakistan whereas Saudi Arabia also announced an investment of US$1bn. On the other hand, news regarding flash floods affecting more 30 million people came in. Since the start of monsoon session in June, roads, bridges and close to half a million homes have been damaged along with a large quantity of the country’s cotton produce.