Karachi, March 11, 2022 (PPI-OT): Soaring oil prices drag KSE100 Index lower by 2% WoW

The week started with investors succumbing to panic from oil prices reaching GFC highs amid talks of Russian embargo and uncertainty looming across markets owing to Russia-Ukrain tensions, with market losing 2.9% in a single day. However, the nose-dive did not last long after the index recovered 1.9% mid-week as oil prices could not sustain the momentum and SBP decided to keep rates unchanged. The index declined 2.0% WoW to 43,653 pints where the biggest losers were the Refineries (-8.2% WoW) and OMCs (-6.5% WoW). In contrast to high oil prices, E and Ps also lost 4.7% WoW.

Also, Auto sector took a beating owing to devaluation of Rs/US$. Average volume declined 0.7% WoW while average value traded decreased by 10.4% WoW. Net foreign selling rose to US$3.1mn from US$0.1mn last week where major selling was witnessed in Banks (US$4.5mn) and Textiles (US$0.4mn). In domestic news, politics heated up on account of no-trust motion and ECC approved the Rs300bn relief package. T-bill auction also saw yields soaring up to 130bp and 6MKIBOR nearing 12% mark despite SBP’s status quo. On the international front, US Congress has tabled a bill to declare Pakistan as a State Sponsor of Terrorism which bears geopolitical implications besides Russia-Ukraine tensions.