KARACHI, July 28: Stocks on Wednesday staged a smart rally as investors covered positions at the lower levels ahead of board meetings of leading companies and market talk of higher dividend and bonus shares.
Bank shares, notably Askari Bank and Bank of Punjab were in the forefront of gainers, followed by rumours of bonus shares by National Bank and leading cement scrips. The KSE 100-share index recovered 36.93 points at 5,351.33 as all the leading base shares finished recovered under the lead of PTCL and OGDCL and some others.
The board meetings of PSO and Fauji Fertilizer are due on Thursday (today) and the market is rife with higher cash dividend plus bonus shares. But what seems to have accelerated the pace of covering operations was the rumours that both Askari Bank and Bank of Punjab are expected to announce bonus shares of about 20 per cent in addition to cash dividend.
"The market is expected to maintain its current recovery drive to the index level of 5,500 on the strength of expected higher dividend by some of the leading companies whose board are meeting before July 31," analysts said.
However, all eyes are now focused on the dividend announcement by PSO, which has shed its extra load in the carryover market amid Tuesday's massive sell-off, they said. The dividend-driven rally is expected to manifest itself in a bigger way at the fag-end of the current week as by that time most of the prominent companies are expected to come out with their payouts.
Leading gainers were led by Noon Sugar, Pakistan Refinery, Glaxo-SKF, Ferozsons Lab, International Industries, Javed Omer and Siemens Pakistan, which posted gains ranging from Rs6.40 to Rs30. Arif Habib Securities, EFU Life, Gatron Industries, and Clariant Pakistan, after higher interim dividend of 55 per cent also rose by Rs2.50 to Rs3.
The largest gain of Rs30 was noted in Siemens Pakistan on renewed short-covering triggered by reports that it will bid for a subsidiary of PTCL shortly. Losers were led by Bannu Woollen, Gadoon Textiles, Fazal Cloth, Century Papers, Lakson Tobacco, Packages, IGI Insurance, Atlas Honda and Dreamworld which suffered fall ranging from Rs2.10 to Rs13.
Trading volume further rose to 274m shares from the previous 178m shares as gainers forced a strong lead over the losers at 191 to 105, with 30 shares holding on to the last levels.
National Bank topped the list of actives, up Rs2.05 at Rs73.55 on 44m shares followed by Bank of Punjab, higher by Rs1.10 at Rs66.30 on 20m shares, D.G. Khan Cement, up Rs1.60 at Rs55.70 on 19m shares, Lucky Cement, firm by Rs1.30 at Rs39.70 on 16m shares, PTCL, steady by five paisa at Rs44.35 on 13m shares, Askari Bank, up Rs1.85 at Rs72.45 on 12m shares. OGDCL, up 30 paisa at Rs66.05 on 10m shares.
Other actives were led by Maple Leaf Cement, up Rs1.05 on 9m shares, F.F. Bin Qasim, unchanged on 8m shares and Nishat Mills, lower 35 paisa also on 8m shares.
FORWARD COUNTER: Pakistan Petroleum was actively traded at the previous rate of Rs109.80 on 9m shares followed by National Bank, higher by Rs1.60 on 3m shares, PTCL, easy 16 paisa at Rs44.21 on 2m shares and PSO, lower 59 paisa at Rs264.90 also on 2m shares.
DEFAULTER COS: After ruling dormant for the last couple of sessions, Crescent Standard Bank came in for active support and rose by Rs1.50 at Rs10.60 on 1.270m shares. Others were modestly traded amid slow trading.
DIVIDEND: Clariant Pakistan, cash interim at the rate of 55 per cent for the year ended June 30, 2004.
BOARD MEETINGS: Faysal Bank, on July 30; Nestle MilkPak, Security Papers, on July 31; Saudi Pak Commercial Bank, on Aug 1; Al-Meezan Mutual Fund, Meezan Islamic Bank, on Aug 2; Union Bank, on Aug 11; Askari Bank, on Aug 11 and 12; and Packages, on Aug 23.
