PSX index support level and ongoing political situation

The index opened with a negative note and faced a volatile session. The local bourse posted a high of 113pts, a low of 259pts and concluded with a loss of 200pts to settle at 43653pts level. The volumes witnessed during the last trading session were comparatively lower than the previous trading session. The index is currently 5.1% below 200-SMA (Simple Moving Average) on daily chart.

The chart formation depicts that the index may find initial support near 43,400. A break below mentioned support can result into further weakness towards 43,150 and 42,850pts level. Alternatively, the index can face resistance near 43,900pts initially and then head towards 44,250 and 44,500 area. It is recommended to accumulate positions on weakness and trade with a cautious approach.

Also Read: PCB on sticky wicket after Pindi pitch fiasco

Meanwhile, it is expected that market to trade in a range amid ongoing political situation where Prime Minister Imran Khan is struggling to keep his allies on his side and to beat the no confidence motion expected in few days, while opposition is offering counter incentives to gather 172 votes against the government.

On the economic front, IMF’s seventh review of Extended Fund Facility (EFF) should kick start today where IMF has reservations on Prime Minister relief package on petrol and diesel and tax amnesty scheme for industries. We would continue to advise investors to remain cautious while our top picks includes LUCK, UBL, MEBL, HBL, GATM, ILP, SYS and TGL.

Also Read: CPHL Citi Pharma Cephalosporin plant expected to commence operations by May this year

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