Karachi, November 01, 2019 (PPI-OT): Second successive month of bullish market momentum as KSE-100 increases 7% MoM in October
The KSE-100 index gained 7% MoM during Oct-2019. There was a surge in average volumes (+66% MoM), whereas average daily value traded moved up by 33% MoM.
Best performing sectors during the month were refineries, engineering, pharmaceuticals, OMCs and cement. On the other hand, major laggards were textile composite, automobiles and banks.
Foreigners remained net sellers during the month, whereas selling was mainly absorbed by individuals and companies.
We review monthly performance of the local equity market during October. The market improved as the KSE-100 index gained 7% MoM during Oct-2019 to close at 34,204. There was a significant spike in average volumes as well, endorsed by a 66% MoM improvement to 190mn/day, whereas average daily value traded headed north by 33% MoM to US$38mn. In major sectors, leading performers included Refineries (+22% MoM), Engineering (+17% MoM), Pharmaceuticals (+16% MoM), OMCs (+11% MoM) and Cement (+9% MoM). On the other hand, laggards during the month among major sectors were Textile Composite, Automobiles and Banks with underperformance of 11% MoM, 7% MoM and 2% MoM respectively. E and Ps provided market returns during the month.
From a flows perspective, net selling of US$13mn was seen by foreigners. However, dissecting the data reveals while foreign companies were net sellers of US$23mn, overseas Pakistanis were net buyers of US$11mn. In locals, major buyers were individuals (US$13mn) and companies (US$7mn), whereas insurance cos. (US$7mn), banks/DFIs (US$5mn) and mutual funds (US$5mn) were among major sellers. Sector-wise, US$14mn worth of selling was witnessed in banks by foreigners, which was mainly absorbed by insurance cos. (US$9mn); in E and Ps, individuals (US$6mn) were buyers, whereas selling was seen by foreigners (US$5mn) and insurance cos. (US$5mn). In Cements, insurance cos. were major sellers (US$10mn) and this was largely absorbed by mutual funds (US$6mn), foreigners (US$4mn), and companies (US$4mn).