KARACHI, April 1: After initial run-up, stocks on Monday ran into snap selling as leading institutional traders liquidated in part their long positions in some of the pivotals. The index was off 21.27 points at 1,846.85, breaching the support level of 1,850.
Essentially, it was weakness of PTCL and PSO, which weighed heavily against the underlying sentiment and triggered sympathetic selling in other pivotals.
The selling in PSO was apparently attributed to market talk that some investors are inclined to push its price lower before the last date (April 6) of submission of Expressions of Interest (EoIs) by the prospective bidders and then to cover positions at the lower levels, brokers said.
However, larger decline was averted thanks to the presence of strong support at the dips and as a result in most of the cases only extreme gains were pared.
After rising early by 15 points on strong buying in the leading base shares, the KSE 100-share index finally ended lower by 21.27 points at 1,846.85 as compared to 1,868.12 at the last weekend.
The interesting feature was that the KSE high-ups have to apply a circuit breaker to forestall speculative rise in the share of Adamjee Insurance after it crossed the daily ceiling rate by Rs2.60.
“Though belated, the moping up of the floating stock reportedly by the management of Adamjee Insurance or its agents could give it a needed leverage to maintain a status quo”, stock analysts at the Moosani Securities commenting on the latest developments on the hostile-takeover bid.
The management of the Adamjee Insurance Company has already sought court verdict followed by reports that the chairman of Muslim Commercial Bank (MCB) has purchased 40 per cent of its shares in an effort to acquire its control. It finished higher by Rs2.60 at Rs37.70, day’s highest bid on 0.806m shares.
The broader market performed as was reflected by a large number of shares, which came in for trading, signalling a good bit of portfolio adjustments and rolling of positions.
Stock analysts at the W.E. Financials predict that the market has more than one reasons to regain its lost index level of 1,900, of course, after meeting its technical demands.
They base their assessment on the developing economic scenario and a possible advent of foreign buying. It was perhaps the weakness of PSO, Hub-Power and PTCL, which pulled the index down as far as
the broader market is concerned its performance was not that bad.
Leading brokers also hold the same view saying fundamentally there is nothing wrong with the near-term outlook as the current lower levels ensure attractive capital gains.
Prominent losers were led by Rafhan Bestfoods and Fateh Textiles, which fell by Rs9.50 and Rs26.30 followed by Grays of Cambridge, Shafiq Textiles, Shell Pakistan, Fazal Textiles, Sazgar Engineering and Pakistan Services, which suffered fall ranging from Rs2.25 to Rs5.
Advancing shares included Tri-Pack Films, Treet Corporation, PICIC Bank, Artistic Denim, Dawood Hercules, Pakistan Tobacco and Siemens Pakistan, which rose by Rs1.50 to Rs10, largest gain being in Siemens.
Traded volume fell to 175m shares from the previous 213m as losers forced a modest edge over the gainers at 139 to 133, with 42 holding to the last levels.
PTCL was actively traded, lower 25 paisa at Rs19.30 on 45m shares followed by Hub-Power, off 55 paisa at Rs24.45 on 40m shares, ICI Pakistan, up 50 paisa at Rs57.45 on 18m shares, PSO, off Rs3.75 at Rs153.40 on 13m shares and FFC-Jordan Fertilizer, easy 45 paisa at Rs6.35 on 11m shares.
Other actives were led by Dewan Salman, lower 60 paisa on 6.261m shares, Pakistan PTA, easy 55 paisa on 5m shares, Sui Northern, lower 20 paisa on 4.517m shares, National Bank, off 50 paisa on 4.508m shares and Fauji Fertilizer, lower 95 paisa on 3.852m shares.
FUTURE CONTRACTS: Speculative issues on the forward counters also followed the lead of the ready section and generally fell under the lead of PSO, off Rs4.10 at Rs155.40 on 1.305m shares. Other declines were mostly fractional.
Among the volume leaders, Hub-Power was leading, off 50 paisa at Rs24.75 on 7.063m shares and PTCL, lower 25 paisa at Rs19.45 on 2.630m shares.
DEFAULTER COMPANIES: Active trading was again witnessed on this counter thanks to presence of support at the prevailing prices.
National Modaraba came in for active buying at the previous level of Rs0.80 on 22,000 shares followed by Allied Motors, firm five paisa at Rs6 on 20,000 shares and Suzuki Motorcycles, also up five paisa at Rs2.65 on 11,500 shares.
