LAHORE - The benchmark KSE-100 index continued its downward trajectory for the second week in a row, declining by another 2.1 percent WoW to end the week at 43,595pts.

Challenges to the national budget FY19 also remained a cause of concern amongst the market participants, keeping fresh investments at bay.

No respite from the foreign inflows as well, as the net flows remained negative ($4.1 million net selling). On the other hand, overall volumes improved during the week by 1 percent WoW to 167 million and ADTO also improved by 3 percent WoW to $57 million as local mutual funds remained busy accumulating positions in a sliding market.

In terms of sectors, oil & gas exploration remained the only heavyweight sector which closed in the green zone as US President Donald Trump scrapped Iran Nuclear deal, sending international oil prices above $77/bbl level and estimates upgrade by major investment banks around the world. Other than this, almost all key sectors such as (1) fertilizers (down 0.6 percent WoW), (2) oil & gas marketing (down 2.3 percent WoW), (3) automobiles (down 3.0 percent WoW), (4) cements (down 3.7 percent WoW mainly on account of increasing international coal prices) and (5) banks (down 3.2 percent WoW) dragged the overall index.

Apart from this, key highlights of the week were (1) winding of budget debate in the National Assembly, (2) consensus amongst cements players to pass-on cost increases, (3) commercial operations of LNG based power plant at Haveli Bahadur Shah, (4) conclusion of Katas Raj case (neutral for cement manufacturers), (5) increase in urea prices of Rs100/bag, (6) cement sales in Apr-2018 registering 18 percent YoY growth and (7) release of FX reserves numbers (US$11.16bn recorded for the week ending May 4, 2018, down 3 percent WoW).

Experts said that market continued to slide for the second consecutive week, sliding 2 percent WoW as increasing political noise, lack of clarity on macroeconomic front and dispute on budget proposals dampened investor's sentiments.

The benchmark index closed at a 8-week low of 43,595 index points with market participation improving by 1 percent & 3 percent in terms of volumes and value, respectively.

Commercial banks remained the major decliners as the sector eroded 286 points from the index. Continuation of super tax and weak earnings outlook for 2018 kept banking stocks under pressure.