KARACHI, June 23: Stocks on Wednesday recovered from the post-budget lows as institutional traders resumed covering purchases at the lower levels on selected counters, but general investors were conspicuous by their absence.
The KSE 100-share index recovered 8.62 points at 5,088.86.
Most of them are still hesitant to re-enter the market and will assess the negative fallout of the reduced Capital Value Tax (CVT) on the share business before resuming normal operations. However, worst seems to be over as the market has already received battering, what the analysts called, technical correction and is ripe for a rebound.
After fluctuating between the low and high of 5,010 and 5,114.43, the KSE 100-share index, finally finished with a modest gain of 8.62 at 5,088.86, reflecting the strength of the leading base shares.
The early sell-off was attributed to official announcement about the reduced Capital Value Tax, with other additional levy on share purchases, and the later short-covering came by way of year-end portfolio adjustments.
"The CVT is now part of the share business and we have to live with it whether we like it or not," says a leading broker. "Lower daily volume could have a significant negative impact on other commission incomes."
But some others hope in a rising market backed by positive economic fundamentals the market generally readjust itself to the changed situations and every thing would be normal during the next couple of sessions.
"What worries investors are negative signals from Islamabad about the political changes and if rumours prove correct, the market could face a major sell-off though it would be more psychological rather than real," they fear.
The positive impact of fiscal incentives for the corporate sector are still to manifest themselves in stock trading, one broker said. "The post-budget bad news never allowed investors to operate under the positive side of the budget."
Although minus signs held a lead over the losing ones, some of the leading shares came in for active support and finished recovered under the lead of Pakistan Oilfields, Pakistan Reinsurance Company, International Industries, Pakistan Hotels, Gillette Pakistan, Arif Habib Securities and Nestle MilkPak, which posted gains ranging from Rs2.25 to Rs8.95.
Some of the inactive shares, notably Dilon, Security Papers, EFU Life, Javed Omer, Unilever Pakistan, Treet Corporation and Wyeth Pakistan, remained under pressure and finished with losses of Rs4 to Rs21.
Other prominent losers were led by IGI Insurance, Indus Dyeing, Thal, Cherat Cement, Millat Tractors and Sitara Chemical, off Rs3 to Rs3.45. Trading volume rose to 279m shares from the previous 253m shares as losers maintained a fair lead over the gainers at 222 to 122, with 31 shares holding on to the last levels.
PTCL led the list of actives, up 80 paisa at Rs41.90 on 36m shares followed by OGDC, lower five paisa at Rs62 on 30m shares, Fauji Cement, steady by 15 paisa at Rs15.75 on 18m shares, DG Khan Cement, up 10 paisa at Rs55.80 on 17m shares, Lucky Cement, firm by 20 paisa at Rs36.85 on 16m shares and National Bank, higher by 60 paisa at Rs63.20 also on 16m shares.
Other actives were led by Maple Leaf Cement, steady by five paisa on 11m shares, FF Bin Qasim, firm by 15 paisa also on 11m shares, Sui Southern Gas, easy 30 paisa on 10m shares and Sui Northern Gas, up Rs1.20 on 9m shares.
FORWARD COUNTER: Bank Al-Falah came in for renewed selling and fell by Rs1.75 at Rs54.50 on 7m shares followed by PTCL, up 72 paisa at Rs41.87 on 6m shares, OGDC, firm by 10 paisa at Rs62.40 on 4m shares, Maple Leaf Cement, steady by 10 paisa at Rs36.35 on 3m shares and PSO, higher by Rs1.75 at Rs252.50 on 2m shares.
DEFAULTER COS: Dandot Cement led the list of actives, up 50 paisa at Rs9.70 on 0.326m shares followed by Standard Investment Bank, unchanged at Rs9.10 on 0.264m shares and Biafo Industries, lower 70 paisa at Rs13.75 on 0.166m shares.
DIVIDEND: Security Leasing Corporation, cash 10 per cent, bonus shares 10 per cent and 9.1 per cent preference shares.
BOARD MEETINGS: BOC Pakistan on June 27, Kashmir Edible Oils and Arif Habib Securities, both on June 28, Arif Habib Investment Management on July 3.
