KARACHI, April 14: Stocks extended the weekend gains on Monday as leading institutional traders were not inclined to take a technical breather despite postponement of the PSO bidding date amid predictions of massive inflow of surplus liquidity after the end of Iraq war. The KSE index crossed the 2,900 index level for the second time during the last couple of months.
After a weak reopening followed by reports of indefinite postponement of sell-off date of PSO, the mid-session witnessed a robust rally indicating investors had other positive reasons to stay on the market.
The KSE 100-share index reopened about 25 points lower as a section of investors who had built up long positions in PSO ahead of its sell-off on April 26, hastened to take profit in the backdrop of reports of postponement.
Finally, it breached through the barrier of 2,900 to finish at 2,905.36 as compared to 2,870.17 at the last weekend, up by 34.65 points as leading base shares maintained their upward drive under the lead of PTCL and Hub-Power.
The total market capitalization also set a new record at Rs630.616bn, reflecting the strength of massively capitalized shares including PTCL and Hub-Power.
The postponement of bidding date came on the request of some strategic Gulf buyers owing to Iraq war and some allied problems because of the abnormal conditions in the neighbouring countries, official sources said.
Worries on the Iraq situation also accelerated the pace of early sell-off and so did threatening posture of the Indian ministers including talk of pre-emptive attack on Pakistan on the pattern of Iraq to check the alleged cross-border terrorism.
However, after some rethinking on the issue, investors were back in the market and covered positions at the lower levels mostly on the selected counters enabling the market to maintain its weekend run-up.
“Investors seem to be relying more on positive local fundamentals rather than the bearish external factors,” analysts said. “Overdue dividend announcements by some leading companies and an attractive bait of capital gains don’t allow them to sit on the sidelines.”
What is more important is the strong presence of institutional traders, who, the general investors think, are building up long positions for good reasons.
“The mainstay of the market’s current run-up appears to be massive inflow of surplus liquidity from the banks and some other institutions as the falling interest rates has made investment in shares more attractive,” analysts said adding “it ensures quick capital gains without taking long-term financial risk.”
Leading gainers were led by Gatron Industries, Pakistan Refinery, Pakistan Reinsurance Co, Parke-Davis and Arif Habib Securities, up by Rs7.25 to Rs15.70 followed by Noon Sugar, General Tyre, Crescent Steel, Pakistan Services, Gillette Pakistan, Millat Tractors, Pakistan Cables, Ferozsons Lab, Century Papers, Packages, Nestle, MilkPak, Glaxo-Smith Kline and Siemens Pakistan, up by Rs3 to Rs7. Losers were led by 13th ICP Mutual Fund, Ismail Industries, PSO, Atlas Battery and Unilever Pakistan, Attock Refinery, and Al-Ghazi Tractors, off Rs1.50 to Rs5.
Traded volume showed a modest rise at 259m shares as compared to previous 248m shares but advancing shares maintained a strong lead over the losing ones at 186 to 104, with 58 shares holding on to the last levels.
PTCL topped the list of most actives, higher by 75 paisa at Rs25.60 on 75m shares followed by Sui Northern Gas, firm by five paisa at Rs26.40 on 34m shares, Hub-Power, steady by 10 paisa at Rs35.55 on 29m shares, FFC-Jordan Fertilizer, easy five paisa at Rs12.45 on 15m shares, PSO, off Rs2.35 at Rs215.85 also on 15m shares and National Bank, up by 35 paisa at Rs28.65 on 6m shares.
Other actives included KESC, steady 25 paisa on 10m shares, Pak PTA, easy five paisa on 9m shares, PIA (A), up by 35 paisa on 7m shares and Bosicor Pakistan, unchanged also on 7m shares.
FORWARD COUNTER: PTCL also attracted strong buying in sympathy with its ready share and rose by 60 paisa at Rs25.55 on 10m shares followed by PSO, off Rs2.50 at Rs211 on 9m shares and Hub-Power, firm five paisa at Rs35.65 on 7m shares.
Sui Northern Gas, was traded higher by 10 paisa at Rs26.45 on 4m shares but FFC-Jordan Fertilizer was held unchanged at Rs12.45 on 2m shares. ICI Pakistan rose by Rs1.25 at Rs52.50 on a modest volume.
DEFAULTER COMPANIES: Shares of over a dozen companies came in for alternate bouts of buying and selling but bulk of the volume was again confined to Suzuki Motorcycles, up by Rs1.50 at Rs13.50 on 0.368m shares followed by Sahrish Textiles, easy 15 paisa at Rs0.50 on 4,500 shares and Allied Motors, unchanged at Rs11 on 3,000 shares. All others were modestly traded.
BOARD MEETINGS: Prime Insurance, on April 15, Pakistan Papersack, on April 17, Otsuka Pakistan, Dynea Pakistan, Maple Leaf Cement on April 18, Jahangir Siddiqui & Co, on April 19, Pakistan Paper Products on April 22, Askari Commercial Bank, on April 23.
