March 22, 2003	Saturday	Muharram 18, 1424

KARACHI, March 21: The post-Iraq war buying euphoria was well-sustained on the stock market on Friday as investors continued to build-up long positions on selected counters amid predictions of further cut in discount rate after Wednesday’s fresh fall in yields on official instruments. The index breached through the barrier of 2,600 at 2,652.

Although weekend bull-run reflects that the current boom conditions could be carried through the next week on the perception of US victory in a short Iraq war but leading analysts again warned of financial risks associated with such unfathomable snap rallies.

The 100-share index recovered another 61.32 points at 2,651.71, breaching through the barrier of 2,600 points with a sustainable margin. During the two post-Iraq war sessions, it has recovered 145 points or about six per cent, significantly adding to the total market capitalization at Rs579bn.

But at the weekend session, it suffered an erosion of Rs5.535bn at Rs578.843bn as compared to Rs584.378bn a day earlier, reflecting the withdrawal of funds from the selected and heavily-capitalized shares for obvious reasons.

The perception that the Iraq war may be short on which the current robust rally is apparently based could well prove elusive as despite power imbalance anything could happen when the question of defence of the motherland is involved, brokers said.

There is no other positive development including the central bank quarterly report, which calculates Iraq war losses at $1bn in the form of higher petroleum prices, they said.

“The market is certainly in an oversold position after having lost about Rs75bn in market capitalization and 400 points in the index and needs a lot of covering purchases at the lower levels but the time is not that ideal owing to high risks in war-like conditions”, analysts said.

“We feel the rally is inspired as bulk of the support is confined to the leading base shares, which together hold over 60 per cent weightage in the index,” some others said adding “we fear longs will leave the market after pushing prices of selected shares to their pre-determined levels”.

No one could dispute the fact that financial institutions are faced with the problem of investing surplus funds in gainful modes of investment but why they should put them in a risk business as the shares, they ask adding “this is the question which create doubts in the minds of small investors”.

The logical way for putting things in right perspective should have been the victory either of the contenders not the news about the invasion on Iraq, they said.

Leading energy shares, notably PSO, Hub-Power, PTCL again led the market advance on renewed support aided by lure of capital gains. Prominent among them being Pakistan Refinery, Attock Refinery, and PSO, which rose by Rs2 to Rs7.25 followed by Javed Omer, EFU General, Blessed Textiles, Faisal Spinning, Gadoon Textiles, General Tyre, Dawood Hercules, Fauji Fertilizer, Glaxo-Wellcome, BOC Pakistan, Pakistan Services and Ghani Glass, which posted gains ranging from Rs2 to Rs3.50.

Losers were led by Century Insurance, Shell Pakistan, Indus Motors, Noon Sugar and Pakistan Resource Co, off one rupee to Rs7.

Trading volume soared to 286m shares from the previous 181m shares as gainers maintained a strong lead over the losers at 165 to 42, with 26 shares holding on to the last levels.

Hub-Power topped the list of actives, up by 70 paisa at Rs37 on 80m shares, PTCL, higher by Rs1.10 at Rs24.15 on 68m shares, Sui Northern Gas, up by Rs1.05 at Rs24.65 on 31m shares, PSO, firm by Rs7.25 at Rs207.75 on 26m shares and FFC-Jordan Fertilizer, steady by 15 paisa at Rs11.15 on 20m shares.

Other actives were led by Dewan Salman, up by 30 paisa on 7m shares, Pak PTA, firm by 15 paisa also on 7m shares, Fauji Fertilizer, higher by Rs2.35 on 5m shares, National Bank, up by 40 paisa also 5m shares and Pakistan Oilfields, firm by five paisa on 4m shares.

FORWARD COUNTER: Fresh sharp gains in all the pivotals featured the trading on this counter where PSO posted a fresh sharp gain of Rs7.65 at Rs208 on 9m shares followed by PTCL and Engro Chemical, higher by Rs1.15 and 1.75 at Rs24.10 and Rs82.45 on 10m and 2m shares.

Hub-Power led the list of actives, higher by 75 paisa at Rs37.10 on 11m shares followed by Sui Northern Gas, up by one rupee at Rs24.60 on 3m shares, ICI Pakistan and Fauji Fertilizer also finished with gains ranging from Rs2 to 2.45 at Rs48.20 and Rs81 respectively.

DEFAULTER COMPANIES: The activity on this counter was relatively slow as investors remained busy in the ready and the forward section. Suzuki Motorcycles again led the list of actives, up by 25 paisa at Rs8.25 on 12,000 shares followed by S.S. Oil and Allied Motors, higher five and 75 paisa at Rs3.10 and Rs10 on 2,000 and 1,000 shares respectively.