October 04, 2006	Wednesday	Ramazan 10, 1427

KARACHI, Oct 3: Stocks on Tuesday suffered a mild technical correction as buying euphoria associated with rumours of acquisition of some local banks by the foreign investors faded in the absence of positive follow-up reports, causing violent either-way price movements in bank shares.

However, the underlying sentiment remained uppishly inclined indicating that the market would resume its upturn when trading resumed on Wednesday on renewed speculative support on selected counters.

The KSE 100-share index finished with a modest fall of 23.52 points at 10.592.72 as compared to 10,616.24 a day earlier, as some of the leading base shares attracted selling under the lead of MCB and National Bank. It touched the session’s high of 10,698.94 on strong early buying.

The KSE 30-share index also fell by 80.02 points at 13,147.48 as compared to the previous 13,227.50 points.

The banking sector was again in turmoil for the second session in a row amid reports of mergers and straight buyouts by some of the foreign buyers. But all appears to be based on the rumours apparently spread by some vested interests to push prices of some of them higher aided by speculative buying.

As a result, some of the banks finished close to their lower limits of circuit-breakers, barring Bank Alfalah which may have some other reasons to rely on in addition to rumours of talks on sell-off its controlling shares.

“I don’t thing that the current run-up is overdone,” says a leading stock analyst Faisal Abbas. “It was a terribly healthy technical correction linked to continuation of the interrupted run-up.”

Higher volume reflects both the buyers and the sellers are active and intend to stay in the market until the rumours about the buyout of some of smaller banks by the foreign bankers found their way into a financial deal, he adds.

Ashraf Zakria, another stock analyst, said higher dividend and bonus shares being announced each session by some of the hereto neglected companies continued to evoke active interest by some of the genuine investors in the share business.

National Foods and Mari Gas were leading among the gainers, up Rs5.10 and Rs4.75, respectively, followed by United Bank, Premier Sugar, Pakistan Engineering, Pakistan Cables and Bank Alfalah, up by Rs2.40 to Rs4.65.

Shezan International and Wyeth Pakistan were prominent among the losers, off Rs9.85 and Rs75, respectively. Other notable losers included PICIC, MCB, Union Bank, Lakson Tobacco, Pakistan Refinery, Pakistan Oilfields, Millat Tractors, IGI Insurance and Thal Industries, off Rs3 to Rs8.70.

Despite the holy month of Ramazan the future outlook appears to be bullish as bulls are not inclined to take a technical breather at this stage and could keep the interest alive on the strength of prevailing speculation on the banking sector.

Trading volume further rose to 205m shares from the previous 181m shares but gainers trailed far behind losers at 114 to 167, with 30 shares holding on to the last levels.

National Bank topped the list of actives, up Rs2 at Rs258 on 27m shares, followed by Bank Alfalah, up Rs2.40 at Rs50.95 on 25m shares, Faysal Bank, lower Rs1.40 at Rs67.20 on 22m shares, PICIC, off Rs3.65 at Rs72.35 on 11m shares, OGDC, steady by 20 paisa at Rs128.40 on 10m shares, Telecard, up 50 paisa at Rs12.20 on 9m shares, and DG Khan Cement, higher 90 paisa at Rs96.90 on 8m shares.

Other actives were led by Lucky Cement, up Rs2.40 on 8m shares, WorldCall Telecom, lower 20 paisa on 7m shares, and Fauji Cement, easy by 40 paisa on 6m shares.

FORWARD COUNTER: Bank Alfalah led the list of actives on this counter, higher by Rs2.45 at Rs51.50 on 9m shares, Faysal Bank, off Rs1.60 at Rs67.85 on 8m shares, and MCB, lower by Rs4.05 at Rs257.95 on 5m shares.

National Bank followed them, up Rs1.25 at Rs260 on 5m shares and PICIC, off Rs3.20 at Rs66.25 on 4m shares.

DIVIDEND: Dewan Cement, five per cent, Sazgar Engineering, bonus share 10 per cent, Al-Abid Silk, cash 7.5 per cent, Fauji Cement, five per cent, Prosperity Weaving, bonus shares 10 per cent.