May 31, 2003	Saturday	Rabi-ul-Awwal 28, 1424

KARACHI, May 30: Stocks on Friday ran into technical correction as a section of investors took profits at the higher levels but bulk of the selling was absorbed at the dips indicating that the reaction essentially is psychological. The KSE 100-share index fell below the barrier of 3,100 points at 3,099.04 owing to the weakness of pivotals.

The underlying sentiment at no stage showed signs that the current run-up is overdone but pointed to fresh pre-budget gains after the market resumes trading next week sans political constraints.

“Most of the basic positive factors will remain at work till the budget,” analysts hoped “despite fears that negative fall-out of the prevailing political deadlock could take away steam out of the market at least for the near-term.”

After hitting the day’s peak level of 3,136 during the morning session, the KSE 100-share index finally ended slightly below its career-best level in active selling in all the leading base shares and finally ended off 17.78 points at 3,099.04 as compared to 3,116.82 a day earlier.

The early run-up was attributed to strong institutional buying in Hub-Power, which, off late, has been under the spell of falling demand for no apparent negative news and has lost the status of one of the top volume leaders.

At one stage short-covering in it was so strong that all roads led to it as both leading investors and institutional traders were out to grab its floating stock at the current levels followed by reports of higher earnings.

Although the market has so far discounted any negative impact of the political standoff on the LFO issue but if the situation takes any ugly turn, despite the current corrective moves, the market sentiment is bound to be affected.

“Already, conflicting rumours about the future of political set up are pouring in but investors seem to have decided to follow the market perceptions rather than to be influenced by the external negative news,” says a broker. The “current run-up is essentially based on some basic positive factors rather than some speculative thinking.”

Budget uncertainties are also there as the opposition is threatening not to allow the passage of the national budget until the LFO issue was resolved and the president gives firm date for his uniform.

Instances of weekend profit-selling were, however, not lacking as some of the weakholders and day traders took profits at the higher level during the afternoon session owing to weekend considerations.

Despite a good bit of weekend selling and bargain-hunting, some of the leading shares managed to finish with an extended gain on active short-covering at the dips.

Leading gainers were led by Mehmood Textiles, Javed Omer, Pakistan Services, Central Insurance, Dreamworld and Arif Habib Securities, up Rs3.60 to Rs5.40 but largest rise ranging from Rs5.50 to Rs13.95 were recorded in Pakistan Refinery, IGI Insurance, Al-Ghazi Tractors, Colgate Pakistan, Bhanero Textiles and Siemens Pakistan.

Prominent losers included EFU General Insurance, Sapphire Fibre, Lakson Tobacco, Ghani Glass, Packages, Atlas Honda, PSO, Pakistan Oilfields and Fazal textiles, which suffered fall ranging from Rs2 to Rs4.75.

Trading volume fell to 214m shares as losers managed to force a modest edge over the gainers at 188 to 183, with 56 shares holding on to the last levels.

Hub-Power led the list of actives, easy 10 paisa at Rs35 on 39m shares followed by PTCL, lower 30 paisa at Rs25.80 on 29m shares, D.G. Khan Cement, easy 15 paisa at Rs19.75 on 15m shares, PSO, off Rs2.15 at Rs213.70 on 12m shares and Sui Northern Gas, lower five paisa at Rs32.15 also on 12m shares.

Other actives were led by Nishat Mills, firm by 15 paisa on 12m shares, KESC, lower 20 paisa on 11m shares, Pakistan Oilfields, off Rs4.25 on 9m shares, Pak PTA, lower 10 paisa on 8m shares and ICI Pakistan, lower 65 paisa on 7m shares.

FORWARD COUNTER: Hub-Power led the list of actives, lower 15 paisa at Rs35 on 7m shares, followed by PTCL, off 36 paisa at Rs25.75 on 4m shares, PSO, Sui Northern Gas, easy five paisa on 3m shares and Pak PTA, lower 25 paisa at Rs8.65 on 2m shares.

PSO came in for active selling in both the matured May and the forward June settlements and fell to finish lower by Rs2 to Rs2.05 at Rs.214 on 2m shares.

DEFAULTER COMPANIES: About three dozen shares came in for alternate bouts of buying and selling but mostly rose under the lead of volume leaders among them.

The largest turnover of 0.248m shares was recorded in Medi Glass, up 30 paisa at Rs2.50 followed by Sunshine Cotton, firm five paisa at Rs1.60 on 88,000 shares and National Modaraba, also up by the same amount at Rs1.20 on 85,500 shares.