LAHORE - After witnessing a rebound in the first four sessions of the week of 611 points, the market nosedived by more than 1,600 points during the first of half of Friday ahead of the Supreme Court's decision regarding the disqualification of the prime minster.

However, the market recovered sharply to close 6 points up after the Supreme Court announced the disqualification of the PM Nawaz as value hunters saw it as an end to longstanding uncertainty. Overall, the market closed 1.4 percent WoW higher with trading volumes increasing by 48 percent WoW to 198 million shares/day and average traded value rising by 36 percent WoW to $97 million/day. Key top charters were Foods (+10 percent WoW) and Refineries (+6 percent WoW) while among the laggards were Sugar and allied industries (-3 percent WoW) and Cements (-2 percent WoW) during the week.

According to expert, index gained 1.4 percent in the outgoing week to close at the 45,912point level. Average volume rose 48 percent. The Jul 28, 2017, marks a historic day for Pakistan, where the apex court disqualified the prime minister as he failed to disclose his assets in his nomination papers for the general elections held in 2013 and furnished false declarations under oath.

On the sector front Food gained +10 percent WoW, Power (+3.5 percent), E&Ps (+3.3 percent), Engineering (+3.1 percent), Chemical (+2.4 percent), OMC (+1.9 percent), Fertiliser (+1.9 percent), Auto Assemblers (0.8 percent), Banks (+0.3 percent); while Cements shed 2.3 percent during the outgoing week.

Individuals (+$23.8m) were the largest domestic buyers, while foreigners sold $13.2m during the week vs selling $2.0m last week; selling was concentrated in Cement ($7.3m) & Banks ($3.9m); buying in Fertiliser ($3.4m).

During the week, the Supreme Court declared that having failed to disclose his un-withdrawn receivables constituting assets from Capital FZE Jebel Ali, UAE in his nomination papers filed for the General Elections held in 2013 in terms of Section 12(2)(f) of the Representation of the People Act, 1976 (ROPA), and having furnished a false declaration under solemn affirmation respondent No 1 Mian Nawaz Sharif is not honest in terms of the Constitution of the Islamic Republic of Pakistan, 1973 and therefore he is disqualified to be a Member of the Majlis-e-Shoora (Parliament).

During the week, Pakistan’s total liquid foreign exchange reserves amounted to $20.4 billion on July 21, down $394 million or 1.9 percent from a week ago. Reserves of the SBP decreased $476 million to $15 billion due to payments on account of external debt servicing and other official payments, a statement by the central bank said.

As the country’s gas reserves deplete, the government has agreed to provide guarantees for raising Rs175 billion for building a third liquefied natural gas (LNG) pipeline for the supply of imported gas to Punjab, which has been most affected by the declining reserves. This is positive for gas utility companies (SSGC & SNGP) and was already expected.

In other news, Oil and Gas Development Company and Pakistan State Oil gained 2.68 percent/2.24 percent respectively as they announced receipts of cash from government following the retirement of PIBs issued in 2013 for the settlement of circular debt. Moreover, Fauji Fertiliser Bin Qasim Ltd disclosed intentions of investing Rs2 billion in its subsidiary Fauji Foods Limited (FFL) by way of investing in 100 percent right issue by FFL. Meezan Bank also announced right shares of 6 percent at Rs50/share to meet capital adequacy requirements.

Experts anticipate participation to improve across the board from next week as jitters regarding Panama case subside and investors look out for smooth political transition.