KARACHI: The Pakistan Stock Exchange (PSX) closed the week positive with gains in oils and selected financials amid average trading during the week to settle near 36,700. “The ongoing bullish rally at the PSX took a breather during the outgoing week, as futures rollover week kept liquidity low in the market,” said JS Research’s analyst Raheel Ashraf. The benchmark KSE-100 index closed the week flat at 36,694, with average trading volumes declining to 249 million shares/day (-23% WoW). Commercial banks (-3.2% WoW) received a battering, as the State Bank of Pakistan (SBP) announced a 25 basis points (bps) cut in the discount rate over the weekend, while food producers (+3.8% WoW) were the star performers of the week. Meanwhile, a surge in international crude oil prices to $50/bbl (seven months high) during the week failed to bring any excitement in the oil sector (-0.2% WoW). Foreigners remained net sellers of $3.8 million during the week. “The wider market remained calm during the outgoing week with relatively lower volumes and concentrated activity in low tier penny plays. The political arena remained muted as the joint committee formed to decide the TOR’s for investigation on the Panamagate scandal held its round of talks, which are yet to bear fruit,” said HAbib Metro Financial Services’ analyst Saba Mahmood. The SBP’s surprise decision to slash DR by 25 bps caught many traders wrong in the financial sector stocks as banking plays bled value in the earlier part of the week only to see late value buying that helped pare losses seen earlier, she added. The fertilizer sector got a much needed boost, first on account of strong rumors of a likely removal of both GIDC and GST from the sector, and later on release of official offtake numbers that reflected a strong month-on-month (MoM) recovery. Budget proposals and statements from key figures at the helm kept the rumor mill churning as market pundits kept their fingers crossed in anticipation of a likely reduction in capital gains tax (CGT), while at the same time increase in taxes on dividends. The week saw K-Electric outrun its peers in the sector as a prominent foreign fund was reported to have started building fresh positions, while chatter of Abraaj selling some of its stake to a Chinese buyer kept the scrip on an ascent. Oil crossed the psychological barrier of $50/bbl but failed in sustaining these levels on fears of supply glut re-emerging as most temporary disruptions slowly start to add back in the global flow. Local E&P names shrugged off this move in prices while POL embarked on a steamy advance as expectations of a higher dividend kept the stock high on the gainers list.