PSX market outlook

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Expect the market to trade in a range, as IMF would approve the new tranche of US$1bn for Pakistan only when all the required actions are completed including passing of Supplementary Finance Bill 2021.

On the economic front, inflation for December edged up to 12.3% yoy, highest level in the last 21 months, mainly driven by soaring prices of fuel, electricity, transport and non-perishable food items.

Moreover, Pakistan’s trade deficit during December declined by 17% mom to US$4.14bn compared with US$5.02bn in the previous month as imports weakened by US$1bn mom to US$6.9bn. We would continue to recommend accumulation on dips in Banks (BAFL, UBL, HBL, MEBL), Cements (PIOC, LUCK, MLCF, DGKC), Tech (SYS, OCTOPUS), Textile (GATM, ILP), Power (KAPCO, HUBCO) and Chemicals (EPCL).

Courtesy – Intermarket Securities Limited.

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