Stocks end lower but outlook brightens on improved macro, diplomatic efforts

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KARACHI: Despite a turbulent week under geographical political concerns, the Pakistan Stock Exchange (PSX) closed a slightly negative note, which lost 1.2 percent weekly week (WOW) to settled at 114,114 points. However, analysts are optimistic about the market approach for the coming week, citing better economic indicators, ease of inflation and IMF distribution expectations. He believes that any symbols of diplomatic de -style between Pakistan and India can create a strong rally.

According to AKD Securities Director Research Mohammad Oasis Ashraf, a complete scale dispute between Pelstan and India is less likely, but despite the recent rise after the Pahalgam incident. He said that nuclear barriers, external financial dependence and diplomatic engagement from the United States and GCC countries work key in every confrontation.

The recent decline in diplomatic relations, the suspension of the Indus Waters Agreement by India, and the Indian Airlines dragged the KSE -100 to 7,104 points (six percent) in April.

Nevertheless, despite these developments, the depth of the market showed significant improvement. On average, the volume of daily trade increased by 31.8 % month (mother) in April, while the average trade price increased by 23.8 % to Rs 43.7 billion.

Ashraf noted that the recent market reform offers an attractive entry point for long -term investors, which has a proportion of earning from index trading to 5.8x and offers 9.5 % profitable production. Improved economic basic principles, including the six decades of inflation, and more than two decades of current account surplus, add strength to this article.

Foreign investors were pure sellers during April, mainly from insurance and brokerage accounts, offloading $ 45 million worth of equity. On the contrary, companies and other organizations absorbed the pressure, injected $ 26.4 million and $ 22.2 million, respectively.

According to Ashraf, it now supports sectors such as banks, research and production, fertilizer, cement, autos, OMC, textile, and technology, which are ready to take advantage of financial softening and financial reforms.

Topline securities analyst Nabil Aaron highlighted that the SE -100 index declined by 1.17 % during the week, mainly due to the increase in regional tensions and the quarterly corporate income.

Investors’ participation also ended with a decrease of 29 % and 6.0 %, respectively, respectively. However, April 9 is expected to be only 0.3 percent, record -reduced, and the next IMF’s Executive Board meeting, compared to the IMF executive board meeting.

Increasing a cautious tone, JS Research’s Syed Daniel Hussein pointed to stabilizing crude oil prices and falling domestic fuel costs as a potential tail winds. He also noted that the IMF has considered 3 2.3 billion package, which includes $ 1.3 billion under climate flexibility and stability (RSF), which will improve liquidity and investors’ confidence.

Although geographical political risks remain, analysts agree that most of the bad news in the market is the price of the market. If stress is ease and the IMF supply moves forward, PSX can be strong in the coming weeks. The wider market tone is cautiously high, which is the priority of high profitable, mainly strong stock.