13 February 2004	Friday	21 Zilhaj 1424

KARACHI, Feb 12: Stocks on Thursday fell across-the-board on panic selling triggered by US President George W. Bush's vow to eliminate weapons of mass destruction from any part of the world, pushing a perfectly bullish market in the reverse gear just in one go. The KSE index was off 85 points, eroding Rs26bn from the market capital at Rs1,253.409bn.

What seems to have further aggravated the situation was his warning to probe the world nuclear black market and punish those involved in nuclear proliferation.

As Pakistan is in the thick of the problem after Dr A. Qadeer Khan's acceptance of proliferation charges there could be more problems for the country and their negative fallout both on the capital market and the economy in the months to come, analysts fear.

What created panic in the market was Mr Bush's warning to attack any country that has weapons of mass destruction in any part of the world. Dividend announcements from Askari Bank, Gillette Pakistan and an interim dividend by Thal Jute were on the higher side of the market expectations, but they came at a time when investors were worried over the nuclear issue.

The other negative factor was massive unloading in the auto sector followed by reports that the government has allowed the import of old and reconditioned cars to provide relief to the general public and broke the monopoly of local assemblers who refused to lower prices despite official warning.

The panic and investor's nervousness were well-reflected in the KSE 100-share, which at one stage fell below the 4,800 figure, signalling a turmoil and a possible collapse of the market but stray institutional buying at the fag-end of the session saved the situation.

It finally ended lower 85.33 points at 4,804.59 as compared to the previous 4,890 and indications are that it could encounter further erosion at the weekend session.

"The nuclear proliferation issue has taken a new turn as was widely speculated after the acceptance of A.Q. Khan of all the charges," analysts said, adding "the fear that some more high-ups may be involved worried investors and weaker among them hastened to liquidate long positions."

Investors have now two options to react to the nuclear issue that now have assumed new dimensions. Either they have to follow the basic fundamentals which are all bullish or to toe the line of nuclear issue and next few sessions will show their calculated stance.

The market witnessed a general sell-off under the lead of pivotals such as PSO, Pakistan Oilfields, Shell Pakistan, Engro Chemical, Bhanero Textiles, Thal Jute, off Rs3.25 to Rs9 but largest decline ranging from Rs22 to Rs35 were noted in Nestle MilkPak and Unilever Pakistan.

Auto shares, notably Pak-Suzuki Motors, Indus Motors, Atlas Honda and Dewan Motors came in for active selling followed by reports of official decision to allow imports of old cars, off Rs3.80 to Rs7.90.

Advancing shares were led by EFU General, Sapphire Fibre, Abbott Lab, Sitara Chemical and Pakistan Services, up Rs2 to Rs4.10, the largest rise of Rs26.65 being in Siemens Pakistan.

Trading volume fell to 28.587m shares in the absence of buyers from the previous 408m shares as losers reinforced their lead over the gainers at 279 to 84, with 53 shares holding on to the last levels.

OGDCL topped the list of most actives, off Rs1.80 at Rs51.95 on 52m shares followed by FF Bin Qasim, unchanged at Rs20.30 on 32m shares, Dewan Salman, easy 10 paisa at Rs25.60 on 28m shares, PTCL, lower 35 paisa at Rs38.60 on 17m shares and Hub-Power, off 20 paisa at Rs39.40 on 16m shares.

Other actives were led by Sui Southern Gas, off Rs1.40 on 16m shares, D.G. Khan Cement, lower 80 paisa on 12m shares, Maple Leaf Cement, off one rupee on 8m shares, PSO, sharply lower by Rs3.25 on 7m shares and National Bank, lower Rs1.85 also on 7m shares.

DEFAULTER COMPANIES: Standard Bank came in for strong support and rose by 40 paisa at Rs8.40 on 1.276m shares followed by Quice Foods, lower 40 paisa at Rs2.50 on 0.174m shares and unity Modaraba, up 15 paisa at Rs1.55 on 0.113m shares.

DIVIDEND: Askari Commercial Bank, cash 20 per cent plus bonus shares of 10 per cent subject to official approval; Thal Jute, interim 30 per cent; Gillette Pakistan, cash 40 per cent; and Fayzan Modaraba, final 4.5 per cent.

BOARD MEETINGS: Safa Textiles, on Feb 16; Haroon Oils, Attock Refinery, International General Insurance, Metropolitan Bank, on Feb 19; International Investment Bank, on Feb 20; Kohinoor Energy, Orix Investment Bank, on Feb 23; Atlas Battery, on Feb 25; and Bata Pakistan on Feb 26.