AKD Securities Limited - Stock Smart.

Karachi -- May 15, 2020 (PPI-OT)

Weekly Review

KSE-100 index closed the week in green, +2.23%WoW to 34,008pts as investors focused on the reopening of parts of the economy and monetary policy announcement at the end of the week. Moreover, economic releases showing unprecedented contraction in economic activity (LSM down 22.0%MoM in Mar'20) kept market participants undeterred as investors seemed to take hope that the economy was bottoming. The announcement of MSCI semi-annual review brought fresh wave of interest in PPL and MARI (included in the small cap index, replacing NML and SNGP) while HBL pared some losses after status quo on existent constituents in the MSCI standard index (contrary to market estimates but in line with AKD expectation).

Other major news flows during the week were; i) PM ordering kick-start of construction activities on Diamer-Bhasha and Dasu Dams (Cements/Engineering: +5.0/5.3%WoW), ii) Saudi Arabia announcing to deepen oil cuts to support prices amid weak demand (E and Ps: +4.3%WoW), iii) Zero auto sales recorded in Apr'20 due to lock down during the month, and iv) PkR50bn agricultural package announced that includes PkR37bn subsidy on fertilizers (Fertilizers: +4.1%WoW) while in a major announcement in the outgoing week, FEROZ (+43.4%WoW) disclosed that its subsidiary BF Biosciences Ltd (BFBL) has signed a non-exclusive license agreement with Gilead Sciences Inc for manufacturing and selling remdesivir - an experimental antiviral...