LAHORE - The benchmark KSE 100-share index closed 1 percent higher at 42,934, however the market did lose some steam towards the end of the week with profit-taking witnessed at higher levels.

The news flows during the week centered on US-Pak relations with suggestions that Pakistan has suspended cooperation with the US, while threat of protests by religious cleric Tahir-ul-Qadri too remained unsettling. Gas utilities (SNGP +18.7 percent WoW, SSGC +6.7 percent WoW) and some steel companies (CSAP +19 percent WoW) garnered investors' interest on ECC approving Rs175b for third LNG pipeline. Apart from these stocks, key sector that outperformed during the week was fertilizers (+1.4 percent WoW) on expectations of a new fertilizer policy and/or measures to reduce urea prices in the country ahead of the general elections. On the other hand, cements (-0.5 percent WoW), E&Ps (-1.5 percent WoW) and Autos (-0.3 percent WoW) underperformed the index. Foreigners remained key buyers during the week with net buying of $25m, while local banks/DFIs were major sellers of $17.6m in the market.

Experts said that outgoing week saw the culmination of the Santa Clause rally which commenced on December 20, 2017 and peaked on Jan 10, 2018 with a net gain of 14 percent. Since then index has had red two sessions correcting 2 percent/697pts, which has trimmed weekly gains to 1 percent/410pts with the index closing the week at 42,934pts level. Going forward, equities maybe further pressured as agitation movement by opposition parties begin on Jan 17.

Participation improved significantly as profits were booked, average volumes increased 30 percent WoW while value rose 44 percent.

Stocks including HBL (+0.7 percent), COLG (+5 percent), POL (+0.7 percent), PIBTL (+1.8 percent) and FFC (+0.3 percent) added 53pts to the index, while PSO (-3.9 percent), DGKC (-4.9 percent), OGDC (-1.4 percent), ENGRO (-1.7 percent) and UBL (-1.1 percent) withheld 159 points. On the sector front, cements and oil & gas marketing sector cumulatively withheld 136 points whereas chemical sector added 17 points.

Foreigners bought $26m worth of shares during the week vs buying of $23m during the last week. On the local front, individuals were net buyers of $11m whereas banks were net sellers of $18.5m.

Chief of Army Staff General Qamar Javed Bajwa received two phone calls from US Centcom Commander General Joseph Votel and one from a US senator over the week to discuss Pak-US security cooperation following President Donald Trump’s tweet, the Inter Services Public Relations (ISPR) said on Friday. The army chief told the US officials that Pakistan will continue its "sincere counter-terrorism efforts" even without US financial support in accordance with its own national interest and will remain committed to bringing the effort to its logical conclusion along with other stakeholders. The National Assembly on Friday unanimously passed a bill extending the jurisdiction of the Supreme Court and PHC to the FATA.

The U Microfinance Bank, wholly owned subsidiary of Pakistan Telecommunication Company (PTC), has acquired additional capital injection of Rs1b as Tier 1 from its sponsors, a press statement said. It said that this new injection will enable the bank to further capitalize on the growth opportunities available in Pakistani microfinance sector. Given the overall economic landscape, competitive environment and the opportunity to serve a considerably large underserved population, this capital injection will provide the necessary growth impetus for the Bank to leverage on.

During the outgoing week, Tariq Glass (TGL) in its notice sent to PSX stated that the construction of the new state of the art Opal Glass Dinnerware Project with a capacity of 35 tons per day, has been completed. It is currently holding the inauguration ceremony for the firing/lighting up of the furnace of this new state of the art plant for manufacturing of Opal Glass Dinnerware. According to a notice sent by HBL Asset Management to PSX, the certificate holders of PGF (PICIC Growth fund) have approved the conversion of PGF from a closed end fund to an open end scheme.