Updated as on 24th June 2012
In last week call we try making traders and investors understand, the KSE-100 reflecting an interesting situation where the index tempting investors to buy and scaring for selling pressure too, and if you look at the sessions of past week you may realize targeted buying from local institutions with feared offloading from local and foreign investors, though they were also found with some targeted buying but their net figures reflecting outflows. Decline noticed in foreign outflows comparing to earlier week as the past week reflecting outflows of USD$ 6,192,748 only and the overall outflows for June 2012 reached to USD$ 103,235,609.
It was also told index still not gained enough momentum for secure buying, and if you look at the weekly low it is accurate to the given stop loss, as the last two session were found testing the given stop loss but sharply recovered and manage to close the week with the gain of 65 points. Volumes were still low even the week lost 20% more comparing to earlier week. But we can not ignore the political situation and decisions made in past week, and at last end up with electing the most incompetent person as a Prime Minister of the country, well not many hopes for investors and common citizens with this new selection as this is nothing but only a face change to secure the ongoing mismanagement. Now investors are going to focus on development on PAK-US relationship which plays vital role in easing donor’s policies, they also like to see what is going to happen with approved finance bill and new budget. Now the new presidential ordinance authenticating the working of former prime minister and cabinet (after 26th April 2012 to the date of his disqualification) which also include budgetary announcement and finance bill will help investors to get out of uncertainty.
I will take it positively as the whole country is not expecting much or having hopes with the new setup, this will keep them calm and keep out of hopes and hypes.
But I still like to remind the concern of investors and traders indicated in last week call too. “Major threat to economy in current scenario are the steps taken by the government in recent budget announcement focusing more on incoming election instead of supporting the ailing economy and having corrective measures for declining growth due to various reason one of those are gas and power shortage, and last but not the least we are going to face terrifying consequences of bad governance and worst law n order situation in Karachi as the business community is in the severe anxiety because of killings of business men for extortion money and it is expected to have more in coming days as we are heading towards Ramadan which is the major season generates revenues”. Now the violent protest in Punjab is another negative impact.
Not many changes happened in Karachi Stock Exchange, but it is appreciated as the investors and traders manage to sustain aftermath of SC decision, past week index moved in low range and with more shrinking participation of stakeholder. But despite of fearing figures of foreign outflows we did not notice any panic selling from local institutions and investors, this is quite positive sign for market.
For detail view on upcoming session KSE-100 and listed companies you can contact firstname.lastname@example.org