Profit-selling halts recovery drive on stock market
By Our Staff Reporter
KARACHI, March 15: Stocks on Wednesday failed to extend the overnight run-up as the weakness of oil shares and National Bank spilled over to other blue chip counters followed by active profit-selling at the inflated levels but the undertone remained uppishly inclined.
The market lacks direction owing to inconsistency in investor perception about the future outlook in the absence of fresh dividend announcements from the corporate sector.
After a higher start, stocks failed to extend the previous gains as follow-up support turned shy in the absence of fresh buying from the foreign funds and local investors.
The KSE 100-share index, however, made an impressive opening on what dealers called, the extension of the overnight buystops and it surged to day’s peak level of 10,582.47 points. But late-selling pushed it down, off 40.26 points at 10,392.91 as compared to previous 10,433.17 points.
“The index took two months to gain 2,000 points but in only six sessions it shed 1,400 points eroding $6 billion from the market capital following exit of foreign investors after Bush visit,” a leading stock analyst Muhammad Sohail commenting on the vulnerability of the market said.
According to official sources foreign investors sold shares worth $53 million during the first two weeks of March, which triggered sellstops from the locals and consequent uncertainty.
An erratic movement of 262 points in the session reflects that investors are still in two minds about the future direction of the market despite the fact that some of the leading shares are now in the buying range, analysts said.
“Everyone is awaiting the resumption of buying by some of the leading foreign funds on those counters where they had unloaded long positions last week,” they said, adding “but as they appear to be in the process of redefining their future portfolio buying, local institutional traders awaited lead from them”.
OGDC, one of the index heavy weights, National Bank, D.G. Khan Cement, Pakistan Petroleum and some other failed to hold on to initial gains on renewed profit-selling having a negative impact on the broader market.
“I don’t think the market could undergo another major shakeout at this stage,” some others said, adding “the boom conditions as witnessed during the last two months may not be around despite market’s highly oversold position”, predict Faisal Abbas, a stock analyst.
Dawood Hercules and Pakistan Oilfields were leading among the gainers, up by Rs16 and Rs12 followed by EFU Life Insurance, EFU General, Lucky and D.G. Khan Cement, Packages, Security Papers and Pakistan Services, up by Rs5 to Rs9.
PSO and National Bank, led the list of losers, off Rs10.30 and Rs10.70. Other, which also fell included Attock Petroleum, Shell Pakistan, Pakistan Petroleum, Wyeth Pakistan, Berger Paints, Dreamworld, HinoPak Motors and Gillette Pakistan, off Rs5.50 to Rs9.05.
Trading volume rose to 295m shares from the previous 274m shares but gainers and losers were about evenly matched at 163 to 161, with 38 shares holding on to the last levels.
D.G. Khan Cement topped the list of actives, up by Rs5.60 at Rs140.50 on 40m shares, followed by National Bank, off Rs10.30 at Rs263 on 36m shares, OGDC, lower 25 paisa at Rs130.90 on 27m shares, Lucky Cement, higher by Rs5.05 at Rs106.45 on 25m shares, PTCL, easy five paisa at Rs61.90 on 15m shares, Pakistan Petroleum, off Rs7.60 at Rs239.80 on 13m shares and Pakistan Oilfields, higher by Rs16 at Rs539.80 on 9m shares.
Other actives included Fauji Cement, higher by Rs1.10 on 17m shares, Fauji Fertilizer Bin Qasim, unchanged on 14m shares and Maple Leaf Cement, up by Rs1.55 on 7m shares.
FORWARD COUNTER: National Bank led the list of losers on this counter, off Rs9.20 at Rs265 on 21m shares, Pakistan Petroleum, lower Rs8.70 at Rs240.50 on 15m shares and D.G.Khan Cement, lower 55 paisa at Rs131.40 on 13m shares and Lucky Cement, up by Rs5.10 at Rs107.45 on 12m shares.
DEFAULTER COS: Trading on this counter was slow barring Dandot Cement which rose by 65 paisa at Rs12.15 on 0.197m shares, others were modestly traded.
DIVIDEND: Silver Star Insurance, bonus shares at the rate of 25 per cent or in the ratio of 1:4, one share for every four held.
