KARACHI: Economic and political issues badly affected local bourse as a result Pakistan Stock Exchange (PSX) benchmark KSE-100 Index fell nine percent in 2022. With Rupees falling 22 percent against USD, Index was down 29 percent in USD terms.
It was also a turbulent year for global stock markets as $18 trillion were wiped out in 2022 with drop of approximately 20 percent in MSCI World Index which is worst performance since the 2008 crisis. MSCI EM fell 22 percent while MSCI FM was down 29 percent in 2022.
Pakistan’s KSE-100 Index was amongst worst performing market in US$ term in 2022.
“Due to macroeconomic issues, activity at PSX also remained dull as average traded volume (ready/cash) per day at PSX was down 52 percent to 230 million shares”, Sunny Kumar at Topline Securities said. Similarly, average traded value per day was down 59 percent to Rs7 billion/day which was lowest since 2019. In futures market, total traded volume and value per day were also down by 33 percent and 56 percent to 94 million and Rs 3.6 billion, respectively.
The KSE-100 Index also underperformed other asset classes in 2022 including Gold (up 45 percent), one-year US$ Naya Pakistan Certificate (up 36 percent) and US Dollar (up 28 percent). T-Bills, Money Market Fund and Property indices posted returns in the range of 12-14 percent in 2022.
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IPO market was also impacted due to falling equity values as only 03 Initial Offerings/IPOs came to raise funds in 2022 as against 08 IPOs in 2021. The numbers of IPOs are also lowest after 2019 when Pakistan saw just 01 IPO at PSX.
Foreign corporate selling continued in 2022 with net selling of $127 million. In last 7-years, foreign corporate have sold shares worth of $2.5 billion at PSX.
Local mutual funds and insurance companies also trimmed their position in 2022 where mutual funds sold $166 million while insurance companies sold $128 million in 2022.
Selling was absorbed by local individuals, banks and companies with net buying of $138 million, $117 million, and $78 million respectively in 2022.
Copyright Business Recorder, 2022