There is industry jargon and niche speak everywhere that only a select few are familiar with. Similarly, within the realm of capital markets, we also have our own proverbs.

We used to frequently express this sentiment in our previous office: “I am certain that I am uncertain about everything.” Or something like “I am sure I am not sure about anything”.

Anyway, coming back to my two cents. Its not only us who has suffered. This marked a global dynamic shift in the world economy post covid.

Remember how long it took us to become Asia’s best performing stock market to worst performing stock market?

In June 2022, the melting economy and boiling political temperatures led Pakistan Stock Exchange (PSX) the third worst performing market in the region.

In August 2020, PSX emerged victorious as the top-performing stock market in Asia.

 

Investors at the PSX saw a wipeout of 16.27% (Rs1.35 trillion) in June 2021.

The market capitalization, or the total value of all listed companies, dropped to Rs6.95 trillion on Thursday, June 9, 2022, a multi-year low. With a value of Rs8.29 trillion, the market capitalization peaked in June 2021.

 

The petroleum refinery, which lost half of its value to Rs66 billion in March, was the most negatively impacted sector, according to the Pakistan Economic Survey 2021–2022. By the end of June 2021, the sector was valued at Rs146.56 billion.

FLOODS IN PAKISTAN

The World Bank released a report in October 2022 that details the damage, loss, and needs that Pakistan experienced after its unprecedented floods.

The report emphasised the severe impact on the housing, agriculture, and transportation sectors, with estimated damages exceeding USD 14.9 billion and rehabilitation needs at least USD 16.3 billion.

The province most severely hit is Sindh, which accounts for 70% of all damages, affecting 33 million people and resulting in over 1730 deaths.

According to the human impact assessment, there could be a rise in multidimensional and national poverty rates. The floods are predicted to have a direct impact of 2.2 percent on FY22 GDP, mainly on the agriculture sector.

LETS TALK ABOUT TODAY 

The KSE-100 index of the Pakistan stock market keeps investors’ equity higher. The index has increased by more than 60% over the past 24 weeks, exhibiting strong performance.

For the third week running, foreign investors remained net buyers, with a notable increase in net purchases of securities. The net purchase for the week ending December 1, 2023, increased significantly to Rs4.33 billion, up from the previous week’s net purchase of Rs1.88 billion.

In conclusion, Pakistan faced several changes and in the capital markets a lot of factors are in play. This is not only for Pakistan, as we know what happened after covid, a big boom in the Stock Markets around the world. Then supply chain disrupted eventually, Oil turned bullish which has a negative impact globally. This doesn’t end here but I hope you get the gist.

None of us are gurus. If you spend enough time in the market, you will discover that there is no Guru, only disciples.

 

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