November 6, 2001	Tuesday	Shaba’an 19, 1422

KARACHI, Nov 5: Stocks on Monday remained in a terribly bad mood, as investors were a bit disappointed over the final dividend of 22 per cent by the Hubco management and indulged in hasty selling, pushing the KSE 100-share index down by 38.91 points or 2.78 per cent at 1,360.90.

It appears to be the complete rout of the bulls as snap selling both from the general investors and some leading institutions signalled the advent of bear rule at least for the near-term, as they successfully made below market expectations dividend by Hubco an excuse to drive bulls out.

“Evidence of foreign selling was hard to find, but some claimed it was there, although it was not very aggressive,” a leading stock analyst at the Finex Securities claims. “But erosions of Rs.9bn from the market capitalization at Rs.333bn tells a different story.”

A final cash dividend of 22 per cent (an interim of 17 per cent already paid) with per share earning (EPS) of Rs.8.60 on a 10-rupee share was not that bad and should have welcomed by the investors as it led to a good beginning after the last two years standoff because of litigation on power rates, but bears were adamant to tilt the balance in their favour. The EPS was negative last year and Rs.5.79 in 1999.

However, when a good sense returns after the current psychological euphoria is over, bears may have some rethinking on the subject as the profit of Rs.10 billion could well prove an attractive bait for them in the weeks to come.

“What seems to have worried investors was the report that the distribution of the dividend has been linked with the lenders approval,” stock analysts at the W.E. Financial believe. “It could well mean delay in payment as it has been in the case of interim as lenders may not be in that hurry to approve it.”

But reaction appears to be more psychological rather than real one and bulls could fight back to tilt the balance in their favour even tomorrow as its current lower levels are attractive enough for any prospective investor.

Its share value fell by Rs.1.15 at Rs.22.05 after the application of circuit breaker by the KSE authorities to forestall further decline in its share. The volume was modest as it is being quoted spot. On early anticipatory support it touched the highest of the day at Rs.23.80, and ended at the lowest for the day.

Stock analysts at the Moosani Securities predict now investor eyes are focused on the board meeting of the PTCL on Nov 8 and lower than market expectations dividend may again jolt the market.

“The market may take some time to change the track owing to enhanced badla volume and fresh float,” stock analysts at Kausar Abbas Bhayani predict. “The corporate news are encouraging but their impact has already been built into the current hike.”

Minus signs dominated the list, as most of the overvalued blue chips fell like the house of cards. Among the MNCs, big losers were led by Shell Pakistan, Al-Ghazi tractors, ICI Pakistan, Engro Chemical, Dawood Hercules, and Lever Brothers, which suffered fall ranging from Rs.1.75 to 12.

Other prominent losers were Adamjee Insurance, EFU Life Insurance, National Refinery, and PSO, off Rs.1.50 to 3.10.

Advancing shares were led by Siemens Pakistan, 4th ICP, 9th ICP Mutual Funds, Tariq Glass after a good dividend and Glaxo-Wellcome Pak, which rose by one rupee to Rs.3.

Trading volume was below 100m shares at 96m shares as losers maintained a strong lead over the gainers at 95 to 48, out of 178 actives.

The PTCL proved to be the most active scrip, off 85 paisa at Rs.17.30 on 57 shares followed by Hub-Power, off Rs.1.15 on 16m shares, ICI Pakistan, down Rs.2.15 at Rs.47.20 on 6m shares, PSO, lower Rs.3.10 at Rs.106 on 5m shares and Engro Chemical, off Rs.2 at Rs.55.25 on 3m shares.

Other actives were led by Sui Northern, off 50 paisa on 2.435m shares, MCB, easy 80 paisa on 0.970m shares, Fauji Fertilizer, off Rs.1.05 on 0.903m shares, Dewan Salman, lower 70 paisa on 0.805m shares and Adamjee Insurance, off Rs.1.90 on 0.635m shares.

FUTURE CONTRACTS: Forward counter also followed the lead of the ready section where Hubco also came in for strong battering, off Rs.1.15 at 20.85 on 9.155m shares followed by the PTCL, lower 75 paisa at Rs.17.60 on 1.274m shares.

The largest decline of Rs.2.25 was noted in the PSO at Rs.103.50 on 67,000 shares followed by Engro Chemical, lower Rs.1.25 at 54.50 on 25,000 shares. Other also fell modestly.

DEFAULTER COMPANIES: Hydery Construction came in for active support at the lower rates and was marked up by 30 paisa at Rs.1.65 on 5,500 shares followed by Ravi Rayon, firm five paisa at Rs 0.80 on 1,500 shares and Crescent Spinning, higher 25 paisa at Rs.2.75 on 500 shares.