Bearish sentiments maintained their control on the market during the week as the benchmark closed in red zones Week-on-Week owing to a bleak economic outlook and resurgence in COVID cases as the positivity ratio climbed to its 2nd highest level during the week.

On the Macroeconomic front, Rupee continues to depreciate against the USD and closed at PKR 176.24/US$. During the week, the Technology and Banking sectors pushed the index in red territory as they plunged by 241 and 96 points respectively. On the flip side the E&P sector remained in limelight during the week and added 36 points to the bourse owing to rising international crude oil prices.

During the week, Foreign Investors were net seller of $2.08mn while Massive selling was witnessed from Mutual Funds (~$7.8mn) and Corporates (~$10.3mn), while Individuals ($12.3mn) and Banks (~$5.9mn) remained Net Buyer.

Major events happened during the week were, Government revising upward FY21 GDP growth to 5.37% against an initial estimate of 3.94%,

Increase in COVID cases with positivity rate at the end of the week reaching 12.9% and positive cases at 7,678 pushing authorities to take measures to contain the spread,

Foreign Remittances clocked in at US$2.5bn for Dec’21, continuing to cushion Pakistan’s external account, Official initiation of process to issue Sukuk bond of US$1bn,

Refineries issuing warning of inventory buildup of Furnace Oil due to lower offtake by power plants.

Individual Stocks which remained green included KAPCO (+8.4%), FCEPL (+4.8%), DCR (+3.6%), GSKCH (+2.9%), and GADT (+2.8%) while stocks which declined during the week included TRG (down 18.6%), ANL (down 12.0%), CNERGY (down 11.0%), JDWS (down 10.4%), and ATRL (down 8.8%).

Next Week Outlook

State Bank of Pakistan is all set to announce its Monetary Policy on Monday (24-January-2022), where market anticipated Status Quo in the decision. However, keeping in view the Inflationary Pressure, Rising Crude Oil Prices and Higher level of Current Account Deficit in December-2021, there exists a likelihood of modest increase (~50bps).

Moreover, Results season for some companies is likely to kick off in next week including KAPCO, HCAR, FFBL, ILP, ATLH, UPFL.

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