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Sunday, June 21, 2020
KSE-100 Week 25-2020 Closing Notes
Political uncertainties and fear of the second pandemic wave kept a negative mood prevalent at the bourse. While the index did try to put a show of support at 33800 -/+ 100 as mentioned in our previous update, it did not resolve into any visible action and hence dismissed. Weekly closing of KSE100 clung narrowly to the lower band of 33600 +/- 100 support range - and it raises a lot of concern. On a positive note, oil and banking index have closed on a rebound which demonstrates the exchange of hands between sectors.
Looking forward, we expect the bourse to perform selectively in certain sectors with increasing volatility and will lead to the discovery of new support and resistance zones. This makes the week 26 ahead, all too important. Risky positions shall be maintained with SL.
KSE-100 weekly capitalization stands at a loss of -180.25 billion/PKR, which is significantly higher than the weekly average gains of two previous periods. We may attribute this to profit-taking but a further loss of capitalization in the week ahead would initiate a reversal into bearish territory.