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Top Five Factors Affecting Pakistan Stock Market This Week


In the previous week, at the closure of trading Pakistan Stock Exchange-100 index was 46711.85, up 379.54 points. Following are the most important factors affecting Pakistan Stock Exchange this week.

Panama Decision Expected on 10 July, 2017

Political uncertainty due to Panama Probe is prevailing in capital market of Pakistan as the decision is expected on 10 July, 2017.

The JIT panel will submit the final report consisting of 13 questions to Supreme Court on July 10.

JIT was to ordered to investigate the assets of ruling family by utilizing the available evidences and materials provided by FIA and NAB.

Some experts are of view that JIT may seek more time for the submission of final report. Upon the final report, the court shall also consider the matter of Prime Minister’s disqualification.

JIT is investigating about the commencement of Gulf Steel Mill, possession of flats, truth behind the letters of Hamad Bin Jasim bin Jabar Al-Thani, the real beneficial owner of M/s Neilson Enterprise Limited and Nescoll Limited, establishment of Hill metal, capital sources of above mentioned enterprises.

Panama uncertainty can overshadow the fantastic growth of Karachi Stock Exchange leading to low business activity in Pakistan Stock Exchange.

Positive News From Chinese Investors

Fast growth Of Karachi Stock Exchange is attracting a big chunk of Foregin Direct Investment (FDI) in Pakistan Stock Exchange. Chinese investors are keen to increase their stakes in Pakistan stock Exchange beyond their 30% current stakes. Securities and Exchange Commission of Pakistan (SECP) is considering to lift the condition that obliges foreign investors of possessing more than 30% shareholding in the three years.

Confirmation of this news will attract foreign investors to capital market of Pakistan. As Chinese investors have shown their keenness to invest in Karachi Stock Exchange it shows the increase potential of Pakistan Stock Exchange.

Approval of Loan From ADB

Asian Development Bank on Friday last week announced the approval of $335 million loan to establish the rapid bus transit system in the city of Peshawar

In addition to the ADB loan KPK government led by PTI will receive two more loans from European financial institutions.

Development of infrastructure is a sign of economic prosperity and improvement in domestic conditions of a country. Approval of these loans is a sign of trust upon economic growth of a country.

Agence the Frančaise de Devélopment (AFD) and European Investment Bank are expected to provide $75 million for co-financing. It is a pleasant news for Karachi Stock Exchange.

Textile Sector Feud

Decline in the exports sector is reported 1.98 over the past 11 months of the current fiscal year. Textile sector is the backbone of Pakistan’s economy. Fall of textile sector is one of the main reasons of increasing trade deficit which has reached 42.12% in comparison to $30 billion to previous fiscal year’s $21.1 billion.

PHMA chairman Adil Butt held government responsible for the sinking ship of textile exports as the government didn’t fulfilled the promises of export incentives as a bailout package of $180 billion along the sales tax refunds.

U.S Investors Worried Of Inconsistent Policies

U.S investors donot find Pakistan attractive for their investments due to political uncertainty ,cultural instability and unreliable judicial system.

A Pakistani delegation led by Zubair Tufail, met with US secretary of International Trade Department Israel Hernandez.

The delegation was informed that complex judicial and social fabric of the country is the main constraint in way of American investment. Mr. Hernandez showed dissatisfaction over the performance of Pakistan Investment Board as well. This statement from Mr. Hernandez could lead to withdrawal of foreign investment from Karachi Stock Exchange.

About Emaad Qureshi