KARACHI, Feb 14: Stocks on Wednesday again reacted from the overnight higher levels on active profit-selling as worries about the higher leveraged positions dominated the trading throughout the session. The KSE 100-share index was off 189 points at 11,455 points.
Analysts said leveraged positions well over Rs50 billion though are still below the recent peak of Rs52 billion caused major sell-off on the overvalued counters despite higher dividend and bonus shares by some of the leading banks.
A cash dividend of 30 per cent plus bonus shares of 25 per cent, with EPS at Rs14.12, United Bank gave a pleasant surprise to its stakeholders and so did Askari Bank, which came out with 50 per cent bonus and 10 per cent cash dividend. But its EPS at Rs11.23 was claimed to be below analysts expectations. It fell by Rs1.85 at Rs122.05.
Both the news gave a clear message to those who could peep through the future and the developing situation in the banking sector owing to its higher earnings and a massive inflow of foreign funds in it, analysts said.
After early run-up to session’s high of 11,789 points, the KSE 100-share index fell to close lower by 188.77 points or 1.62 per cent at 11,454.76 as compared to previous 11,643.53 points a day earlier as all leading base shares fell sharply lower under the lead of OGDC, National Bank, PTCL and Pakistan Petroleum. Market capital also fell by Rs47.488bn at Rs3,127.156bn.
“The market thriving on a massively borrowed money could falter any time to meet its technical demand,” a leading analyst Ashraf Zakria said
“with CFS investment staying above Rs50 billion plus, the retreat with allied financial risks is always there.
In similar situations as the prevailing ones, the jitters among the weak holders and short-term investors further accentuate the situation in various forms, he said.
However, the fresh correction was against the predictions of some leading analysts who predicted continued bull-run above the 12,000 level, another analyst Faisal A. Rajabali said.
“No one should worry by the snap fall,” he said adding ”all the basic fundamentals points to a robust market on the strength of upcoming higher dividend still in the pipeline.
Treet Corporation and Rafhan Bestfoods were leading among the gainers, up by Rs13.80 and Rs34, Lakson Tobacco, EFU Life, Arif Habib Securities, MCB, Jahangir Siddiqui and Co, Clariant Pakistan, Grays of Cambridge, and National Foods, up by Rs4.50 to Rs7.Prominent losers were led by Nestle Pakistan and Jahangir Siddiqui and Co, off Rs10 each. Others, which followed them included Berger Paints, Pakistan Refinery, Shell Pakistan, Pakistan Petroleum, National Bank, and PSO, which suffered fall ranging from Rs5 to Rs8.
Trading volume was maintained on the higher side owing to active selling in most of the pivotals rising to 348m shares from the previous 325m shares but losers held a fair lead over the gainers at 186 to 118, with 43 shares holding on to the last levels.OGDC came in for active selling and fell by Rs3.05 at Rs122.95 on 40m shares followed by TRG Pakistan, up 85 paisa at Rs11.85 on 36m shares, Bank Al-Falah, easy 15 paisa at Rs51 on 29m shares, National Bank, off Rs6.40 at Rs289.10 on 29m shares, PTCL lower Rs2.15 at Rs2.57 on 28m shares, and MCB, higher by Rs7 at Rs297 on 12m shares.
They were followed by Bank of Punjab, off Rs4.05 on 26m shares, Pakistan Petroleum, off Rs7 on 14m shares and, PICIC, lower Rs2.20 on 13m shares.
FORWARD COUNTER: National Bank led the list of actives, off Rs6.70 at Rs290.25 on 17m shares followed by OGDC, lower by Rs3.10 at Rs123.40 on 15m shares and MCB, higher by Rs5.15 at Rs296.40 on 11m shares.
Others actives were led by PTCL, off Rs2.45 at Rs57.65 on 10m shares and Bank of Punjab, lower by Rs4.10 at Rs123.35 on 8m shares.
DEFAULTER COS: Active scrips on this counter also fell fractionally in sympathy with their counterparts in the ready section, leading among them was Crescent Standard Bank, up by five paisa at Rs4.40 on 0.470m shares followed by Zeal-Pak Cement, lower by 35 paisa at Rs5.35 on 0.393m shares and Nimir Chemical, lower five paisa at Rs3 on 0.199m shares.
DIVIDEND: Hub-Power, interim at the rate of 12.5 per cent, General Tyre did not declare any dividend for its financial year ending June 30, 2007.
