Pakistan’s benchmark KSE-100 index witnessed its largest decline after eight quarters (two years) as the index went down by 8 percent on a quarter-over-quarter (QoQ) basis and 12 percent in FY22.

The benchmark index was also down 17 percent in US Dollar (USD) terms in the second quarter of the current fiscal year (Q2FY22), according to a report by Topline Securities.

The report said that the delay in the International Monetary Fund (IMF) program, increased political uncertainty, rise in inflation, and expanding current account deficit (CAD) continued to impact the market during the quarter. The KSE-100 index went down by 12 percent in FY22 compared to an increase of 38 percent in FY21.

As per Bloomberg data, Pakistan was not amongst the top or worst performers during this period. Sri Lanka (-33 percent), Namibia (-27 percent), and Peru (-27 percent) were the worst-performing markets during the quarter, whereas Lebanon (+45 percent), Russia (+33 percent), and Jordan (+11 percent) were the top-performing markets.

Traded Volumes

In 2Q2022, average traded volumes in the Cash and Ready market declined by 63 percent year-over-year (YoY) while increasing by 9 percent QoQ to 250 million shares per day. The average traded value also deteriorated by 64 percent YoY while remaining flat on a QoQ basis to Rs. 7.2 billion per day during Q2FY22.

The average volumes in the futures market also declined by 28 percent YoY while increasing by 7 percent QoQ to 106 million shares per day. The average traded value of the same declined by 65 percent YoY and 10 percent QoQ to Rs. 3.4 billion per day.

IPOs

No Initial Public Offering (IPO) was seen on the main board during the quarter under review. However, there was one IPO on the GEM Board of Supernet Limited (GEMSPNL) in the quarter where the company raised Rs. 475 million at a strike price of Rs. 22.5 per share.

Top Sellers

Mutual funds were top sellers during the quarter with net selling of $59 million followed by insurance of $58 million, foreign corporates of $38 million, and brokers of $3 million. Individuals, banks, and companies were key buyers with net buying of $76 million, $34 million, and $29 million respectively.

Sector-wise Performance

The key cyclical sectors that underperformed the market during the quarter included cement, automobile parts, and engineering. The key sectors that outperformed were refinery and oil & gas marketing driven by higher refinery margins and news of a hike in gas prices.

Source: Radio Pakistan