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Karachi stock exchange-100 index decreased by 1088 points

Pakistan stock market saw a negative week as Karachi stock exchange-100 index decreased by 1088 points during the week.The profit taking by investors, political and economic uncertainty are three most important factors affecting the  Pakistan stock market.Domestic investors showed considerable interest in the market. However foreign investors sold net equities of $ 16.4 million during the week.This trend shows that foreign investors are still not comfortable about investing in the Pakistan stock market.

Karachi stock exchange-100 index started the week at 51750  points and ended the week at 50742 points. The weekly share trading volume showed an increase of 0.28 % as compared to the last week. The weekly share trading volume was approximately 1750 million shares as compared to the last week’s volume of 1755 million shares.

Pakistan stock market started the week on a positive note as investors were really excited about the MSCI inclusion of the Pakistan stock market in the upcoming month.The Karachi stock exchange-100 index rose by  636 points during first trading day of the week. The upward ride of the Karachi stock exchange-100 index was checked by the federal budget uncertainty and profit taking by the investors.The index fell  by 1643 points during the last 4 days  of the trading week.

Future Outlook

Market analysts are expecting a mixed sentiment in the upcoming week.Upcoming federal budget, American  and local political uncertainty will play an important role in affecting the Pakistan stock market.Comey firing incident has really affected the international stock mareket and it can also affect the local stock market in the upcoming week.Panama Case JIT will submit its initial report to the supreme court on 22nd may,2017.The JIT has also called the Qatari prince to submit reply to the SC.Panama case is also creating kind of uncertanity till the final verdict of the case.

Pakistan industry is expecting lots of  facilities from the upcoming  federal budget 2017. Textile industry has recommended FBR to keep the sales tax zero-rating for export sector in the upcoming budget 2017/2018 by removing further tax at 2% .Federal Board of Revenue (FBR) has been suggested by the textile industry officials to decrease customs duty to 0 % to 3 % on different types of imported goods.These imported goods are not manufactured locally.The textile industry has also made demands of withdrawing  7 % customs duty on import of polyester raw materials.This thing will imrpove the    market share of Pakistani textile industry in the international market.The investment scope will imrpove after all the proposal acceptance submitted by the Federal government.

Investors should adopt buy and hold strategy in this scenario.They can invest in value stocks of profitable sectors like cement and power sectors.

About Emaad Qureshi