STOCKS continued to seek further higher levels during the last week boosted by the strength of mega issues such as the PTCL, the Hub-Power, the PSO and some others and finished modestly higher despite selective profit-selling.

“We don’t call it moping operations ahead of privatization, although it looks so in the backdrop of massive activities in leading among them, it may have relevance to the developing corporate scenario”, some leading floor brokers commenting on the massive activities said.

Whether or not the market is in oversold or overbought position, the investor agenda appears to have as much stocks as they could at the current levels followed by predictions of a continued bull-run.

The market, therefore, remained in a bullish frame of mind as despite highly erratic mid-week price movements followed by speculative turmoil on the Lahore Stock Exchange the outlook remained optimistic.

The KSE 100-share index rose by 51 points or three per cent at 1,774.51 pushing the market capitalization above the barrier of Rs400 billion at Rs402 billion after about two years. It has fallen in between to as low as Rs234 billion.

Market talk of an increase in the margins of the oil marketing companies to three per cent seemed to have given a definite turn to the trend followed by massive buying in the energy shares, notably the PSO,the Hub-Power and the Shell Pakistan.

Encouraging dividend announcements from the textile sector for the financial year ended Sept 30, 2001 also aided the general sentiment, with some of the leading textile shares remaining in the forefront of the advancing shares.

The post-Eid holiday week saw the market in the tight group of speculative forces based partly on the perception of a robust economy and an imminent big selloff of the state-owned units including the PSO and the PTCL.

“Both the genuine investors and the speculative forces are out to take positions in the shares on the privatization list at the lower level for capital appreciation”, analysts said.

Massive buying in the share of the PSO amid hot news of its early sell-off triggered buystops in the other pivotals putting the market back on the rails after Tuesday’s weak performance and there are good reasons behind the moping operations, these analysts added.

“The Lahore-based speculative support picked up the thread where it has left in the pre-Eid holidays and lured others in the ring to give a buoyant outlook to wavering investors”, floor brokers said, adding that “both the mega issues, the PTCL and the Hub-Power will be traded spot and they are not inclined to miss the available breather”.

The KSE 100-share index breached through the barrier of 1,750 just in one go at 1,775, raising hopes that the next chart point of 1,800 may not be that far off. The net rise over the week was 50.87 points or 3 per cent.

“ The PSO has been in strong speculative for the last about two weeks followed by Privatisation Commission’s firm resolve to disinvest it before the current fiscal is out the deadline being June 30”, stock analysts said. Its share posted a gain of R10 at Rs143.75.

Its 10-rupee share value has appreciated by Rs30 since and it may go to any high in the subsequent sessions despite lower sales for the first half of the current year owing to inventory losses. Its previous all-time record was established in the 90s at Rs400 per share.

“ A prominent oil giant is after its floating stock and is cornering it apparently to have enough stake before the final bid”, said a member of the KSE.

While the board meeting of the PTA was held on Feb 27, the ICI Pakistan directors is still to meet to review the annual accounts and it may declare dividend also. Both the shares evoked good interest and ended higher.

Apart from a galore of board meetings, notably from the textile and sugar sectors whose annual accounts close on Sept 30, and expectations of dividend, the perceptions of an economic recovery also aided the market to behave properly.

“The market could rise further as long as the Lahore-based support persists but it is unclear what will be its reaction after it withdraws”, a broker said adding “ it will fall to the lot of institutional traders and foreign investors to keep the rising tempo up”.

All the sectors participated in the run-up,energy,textile and chemical shares being in the forefront on strong support. Nestle Milkpak responded favourably to 60 per cent final dividend and rose by Rs805 and so did the PSO, which spurted by Rs25 on speculative support. Lever Brothers recovered the previous loss.

Other good gainers were led by 9th the ICP, the Adamjee Insurance, the Star Textiles, the Gatron Industries, Al-Ghazi Tractors and Shell Pakistan and many others including second-liners.

Losers were led by Millat Tractors, Murree Brewery, Fateh Industries, Crescent Steel, Rupali Polyester, Berger Paints, Blessed Textiles and several others.

Forward counter also followed the lead of the ready section where bulk of the support remained confined to the PSO, the PTCL, the Hub-Power and some others including the Engro Chemical. The on-balance closing was firm.

Despite the closure on account of Eid holiday, the traded volume was maintained on the higher side thanks to massive activities in the PTCL and Hub-Power including over 100m shares in a single session. Both accounted for 80 per cent of the total turnover.

Other actives were led by the PSO, the Sui Southern, the Fauji Fertiliser, the ICI Pakistan, the FFC-Jordan Fertiliser, Engro Chemical, the KESC, the National Bank, Maple Leaf Cement, Southern Electric, Adamjee Insurance and several others on other counters. —Muhammad Aslam