KSE-100 Index reports lowest index return (9.8pc) since market crash in 2008 | Pakistan Today

KSE-100 Index reports lowest index return (9.8pc) since market crash in 2008

Still better by 4.4 and 5.5 per cent from the MSCI FM and EM Indexes respectively

Lowest after the market crash in 2008, the total index return of benchmark KSE-100-index pegged at 9.8 per cent (6.6 per cent in USD) or 3,385points in the fiscal year 2015-2016.

Despite seeing a decrease in both the average daily volume (by 3.1 per cent) and average daily traded value (by 14.3 per cent), KSE-100 successfully out-performed the MSCI Frontier Market and Emerging Market indexes which declined by 14.2 per cent and 15.3 per cent respectively.

The average daily volume clocked in at 208 million shares while the average daily traded value registered at $91 million during the fiscal year 2015-2016. Analysts at Taurus Securities attributed this decline to the fact that the investors remained more focused on mid-tier stocks during the said period.

The index traded between oil-slump induced intra-day low of 29,785 points in January 2016 to post MSCI emerging market inclusion intra-day high of 39,040 points in June 2016.

Foreigners remained net sellers throughout the year with an offload of $282 million worth of stocks. Major outflows were witnessed in banking and oil exploration and production sectors on the back of monetary easing and slump in oil prices.

Among the key sectors, Tobacco (+38.4 per cent), Pharmaceuticals (+37.2 per cent) & Cements (23.5 per cent) were top performers in the fiscal year 2016 while Food (-11.2 per cent), Chemicals (-7.4 per cent) and Oil & Gas (6.5 per cent) underperformed the broader index during the period under review.

The performance of the Benchmark KSE-100 Index remained volatile during the fiscal year 2016. However, anticipation created by the expected reclassification of the Pakistani stock market to MSCI emerging markets during the months of May and June played a vital role in creating a bullish trend at the end of the fiscal year.

As the effects of Brexit (United Kingdom’s exit from European Union) subside, experts forecast that the KSE-100 Index will generate healthy returns in the fiscal year 2017. This is on account of expected large foreign inflows on the back of Pakistan’s reclassification in the MSCI emerging market index and upbeat earnings from various sectors due to projects under the China-Pak Economic Corridor.

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