Market Daily: PSX gains 163 points, closes in green post-Eid

LAHORE: As the Pakistan Stock Exchange (PSX) opened for a single session after the Eid holidays, trading remained dull. Investors preferred to sit on the sidelines and market participation was thin. In a report, Moody’s Investors Service mentioned that depreciation of the domestic currency is likely to increase inflation and borrowing costs. The credit rating agency expects the fiscal deficit to touch 4.80 per cent of the Gross Domestic Product (GDP).

Despite Moody’s comment on Pakistan regarding the country is one of the most vulnerable to dollar appreciation and that Pakistan’s debt affordability would weaken significantly, the market managed to crawl up by 163 points to 42,588 index level.

The sectors that were top performers included Fertilizers, adding 61 points and Power Generation & Distribution which added 27 points to the benchmark index.

Market participation remained depressed as volumes were down 21 per cent to 115.9 million shares while value traded fell 30 per cent to $36.2 million.

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Crescent Star Insurance (CSIL) announced its consolidated result of 2Q2018 posting LPS of Rs0.59 vs. EPS of Rs0.15 in the similar quarter last year. Decline in earnings was attributed to 1) lower insurance premium, down 20.5 per cent YoY, 2) higher insurance claims & acquisition expenses, up 35.8 per cent YoY and 3) investment loss.

GlaxoSmithKline Consumer Healthcare (GSKCH) Pakistan posted its 2Q2018 result with EPS of Rs1.01 down 40 per cent YoY. Sales for the company fell 13.8 per cent YoY while lower gross margins, down 9.4ppts to 32 per cent YoY and higher financial charges up 1066x YoY affected the company’s bottom‐line.

US State Department’s spokesperson Heather Nauert stood by the department’s readout on the recent phone call between Prime Minister Imran Khan and US Secretary of State Michael Pompeo. A readout issued by the US State Department had said: “Secretary Pompeo raised the importance of Pakistan taking decisive action against all terrorists operating in Pakistan and its vital role in promoting the Afghan peace process. “ However, a tweet from Foreign Office of Pakistan denied the statement relating to any talk done on terrorist activities.

Meanwhile the newly elected Prime Minster was chairing meeting of the cabinet at close of the session.

The market volume was recorded at 115.61 million with Worldcall Telecom Limited (WTL +3.94 per cent) being the top pick of investors, volume 22.37 million. Unity Foods Limited (UNITY +4.99 per cent) and At-Tahur Limited (PREMA +4.97 per cent), peers from the food sector followed with both on cap price. UNITY saw an exchange of 7.86 million while PREMA had 7.22 million shares trade on the day. In its brief trading history, less than a month, PREMA has managed to rise by 50 per cent.

The coming week is expected to see financial result announced by prominent names including Fauji Cement Company Limited (FCCL -0.23 per cent). In quarter ranging from April to June, both Bestway Cement Limited (BWCL -0.69 per cent) and Lucky Cement Limited (LUCK +0.09 per cent) both reported a slight decline in the quarter on quarter sales.

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