KARACHI, April 29: The KSE-100 share index on Tuesday again crossed the barrier of 2,900 points, and analysts predict its next target of 3,000 now appears to be well within reach aided by positive developments on the political front, notably the LFO and the prime minister’s invitation to his Indian counterpart to visit Pakistan.
“The LFO-rally is sustainable if all goes well with the political perceptions of the contenders of power and together with positive response from India for talks, the market could witness a major breakthrough beyond the 3,000 index level not in a very distant future,” they said.
The index stood firm at 2,914.62, up 41.92 points or 1.46 per cent signalling that now it could hit its next target of 3,000 points if all goes well with the current initiatives on the LFO and the normalization of relations with India. The market capitalization rose by Rs8.815bn at Rs639.327bn as compared to Rs630.512bn a day earlier.
The buying euphoria was so strong that the market did not react bearishly to the reports that the visiting Hague team has started inspection of FFC-Jordan Fertilizer company’s production facilities to “ascertain whether or not it is producing chemical weapons.”
The company produces urea and DPA fertilizer and belongs to a well known Fauji Foundation, which owns a chain of industries, including Fauji Fertilizer, one of the leading urea producers. The share value of FFC-Jordan rose by 30 paisa at Rs11.70 (face value Rs10) on over 3m shares.
“Investor are now focusing their attention on the internal and external political developments and their likely positive impact on the local stock market,” analysts said. “Any breakthrough on the LFO front in the backdrop of committee finding could give the needed push to the market.”
But the market could receive major boost if the Indian prime minister accepts Pakistan’s invitation and decides to visit Lahore to resume bus diplomacy the market may witness boom-like conditions.
During the last couple of weeks, notably after the Iraq war, investors were generally guided by the encouraging corporate announcements from some of the leading companies but now they will readjust their priorities in line with the positive political developments both in Pakistan and outside.
“Good corporate announcements may dry up during the next couple of weeks and investors may look for some other stimulants to maintain the current tempo,” brokers said, adding “most immediate among them could be from the political front.”
Siemens Pakistan, which came out an interim dividend of 130 per cent was among the top gainers followed by Parke-Davis, which rose by Rs46.50. Other good gainers were led by Packages, New Jubilee Insurance, Gul Ahmed Textiles, Lawrencepur Woollen, PSO, IGI Insurance, Atlas Battery, Shell Pakistan, Nestle MilkPak, Millat Tractors, Clariant Pakistan and several others, up by Rs3 to Rs6.
Treet Corporation and Unilever Pakistan led the list of losers, off Rs11 to Rs24 followed by Gatron Industries, Lakson Tobacco, Security Papers and Bhanero Textiles, lower by Rs2.35 to Rs5.
Trading volume rose to 172m shares from the previous 120m shares as gainers held a strong lead over the losers at 228 to 101, with 60 shares holding on to the last levels.
Sui Northern Gas topped the list of most actives, higher by Rs1.15 at Rs27.45 on 33m shares followed by PTCL, up 40 paisa at Rs24.75 on 30m shares, Hub-Power, higher by 65 paisa at Rs34.85 on 27m shares, PIAC, firm 20 paisa at Rs11.25 on 16m shares, and PSO, higher by Rs4.50 at Rs206.80 on 9m shares.
Other actives were led D.G. Khan Cement, higher by 45 paisa on 7m shares, Pak PTA, firm by 10 paisa on 3m shares, Pakistan Oilfields, higher by Rs1.50 also on 3m shares and KESC, steady five paisa on 2.462m shares.
FORWARD COUNTER: PSO also came in for strong support on the forward counter in sympathy with its ready counterpart and recovered to close higher by Rs4.55 at Rs207.95 on 6m shares followed by ICI Pakistan and Engro Chemical, higher by Rs1.05 and Rs1.50 at Rs51.25 and Rs79.60, respectively, on light trading.
PTCL topped the list of actives, up 45 paisa at Rs24.85 on 7m shares followed by Hub-Power, up 60 paisa at Rs34.95 on also on 7m shares, Sui Northern Gas, up 90 paisa at Rs27.40 on 6m shares and FFC-Jordan Fertilizer, up 35 paisa on 1.375m shares.
DEFAULTER COMPANIES: The shares of a record number of companies came in for trading as investors opted for low-priced ones amid predictions that smooth sailing on the political front could ensure higher capital gains.
Suzuki Motorcycles again the list of actives, unchanged at Rs14.10 on 0.132m shares followed by National Modaraba, up 25 paisa at Rs0.70 on 40,500 shares, Crescent Spinning and Crescent Board, higher 25 paisa and unchanged at Rs2.25 and Rs4, respectively, on 11,000 shares each.
