KARACHI, Dec 17: The KSE 100-share index on Tuesday confidently crossed the barrier of 2,500 points as bulls were not inclined to take even a technical breather and indulged in fresh speculative buying, outwitting bears after having made deeper inroads in their domain.
The mid-session saw it hit the nine-year peak level at 2,519 points, an increase of about 32 points over the last close. But this crucial level could not be sustained as a section of bears fought back after indulging in hasty selling in the pivotals at the inflated levels. It finally ended around 2,497.27, up 8.79 points.
“It finally crossed the rubicon straight without having made abortive bids earlier as in the case of 2,400 point index level”, one broker said “what next is pretty difficult to predict at this stage”.
But the prevailing selective buying euphoria in Hub-Power and PTCL reflects that the best level still has to come before the year is out.
Bullishness was more pronounced on the forward counter where both PTCL and Hub-Power came in for strong speculative support and rose sharply on large turnover.
Some brokers claim it was the strength of the cleared list, which spilled over to the ready section, creating boom-like conditions. The hedging facilities on the forward counter being the chief rescuing operative for those who will need a bail-out package at any stage of the current run-up or the market retreat, they added.
Over the last one year, it had risen by more than 100 per cent from 1,200 to 2,500 points, adding Rs150 billion to the market capitalization but it has still to match its spectacular performance of the mid-90s boom conditions.
“The market capitalization soared to Rs610bn after the index had hit the all-time high of 2,662 in March 1995”, says a leading analyst commenting on the recent performance of the market “but the current figure at Rs564bn reflects that the broader market failed to benefit from the selective rise”.
Incidentally, at that time some of the leading mega and massively capitalized issues including PTCL were not listed on the KSE and hefty rise in the market capitalization did reflect the general price flare-up ensuring a fair return on investment to all the participants.
“Buy as you like in the safe havens such as Hub-Power and PTCL, which together hold a weightage of about 44 per cent in the 100-share index and push it to any high ignoring the broader market”, one broker jokingly said adding “but I don’t term it a speculative rise though there are not many cogent reasons to sustain this level at least for the near-term”.
Selective foreign fund buying is there aided by local financial support but most of the genuine investors are not inclined to ride the bandwagon until they are sure that may not be caught in the whirlpool after the speculative forces retreat.
The market witnessed a fair amount of profit-selling at the higher levels as was reflected by the day’s total changes, 157 being plus and 154 minus signs, with 58 shares holding on to the last levels out of the total 369 actives.
Gul Ahmed Textiles and IGI Insurance were leading among the gainers, up by Rs3.45 to 6.45, followed by First, 8th and 19th ICPs, Metropolitan Bank, Crescent Steel, HinoPak Motors, Siemens Pakistan and Adamjee Insurance, which rose by Rs1.45 to 3.40.
Wyeth Pakistan and Unilever fell by Rs15 and 27.90. Babri Cotton, Din Textiles, PSO, Pakistan Oilfields, Clariant Pakistan, Tri-Pack Films, BOC Pakistan, Mehmood Textiles and Fazal Textiles, also suffered fall ranging from Rs1.25 to 5.
Trading volume rose to 361m shares and 108m on the forward counter thanks to heavy buying in PTCL and Hub-Power.
Hub-Power again led the list of most actives, up by 45 paisa at Rs32.45 on 168m shares, about a half of the total followed by PSO, off Rs1.15 at Rs187.85 on 28m shares, Nishat Mills, higher 60 paisa at Rs20.10 on 20m shares, National Bank, lower 25 paisa at Rs27.75 on 18m shares, PTCL, up by 80 paisa at Rs25.90 also on 18m shares and Adamjee Insurance, higher Rs3.40 at Rs64.10 on 10m shares.
Other actives were led by Engro Chemical, easy 20 paisa on 14m shares, Sui Northern Gas, up 35 paisa on 13m shares, ICI Pakistan, unchanged on 10m shares and Japan Power, firm by 15 paisa on 7m shares.
FORWARD COUNTER: A record business of 108m shares was recorded on this counter, bulk of which about 44m shares went to the credit of PTCL up by 20 paisa at 23.80 followed by Hub-Power, higher 45 paisa at Rs32.45 on 37m shares.
PSO on the other hand was an exception, which came in for active selling and fell by Rs1.40 at Rs188.10 on 12m shares and so did Sui Northern Gas and Engro Chemical, off 65 and 15 paisa at Rs20.80 and 77.75 respectively.
DEFAULTER COMPANIES: Brisk activity was seen on this counter as investors played on both sides of the fence on small margin of profits. Mehran Jute, proved to be the most active scrip, firm by 10 paisa at Rs0.95 on 88,000 shares followed by Pangrio Sugar, steady also by the same amount at Rs.1.25 on 42,500 shares and Allied Motors, higher by 50 paisa at Rs13.50 on 30,000 shares. Some others were also actively traded.
