KARACHI, May 22: The share market on Tuesday staged a snap rally boosted by active short-covering in the oil shares followed by reports of increase in world oil prices and sympathetic earning-based covering purchases on the other counters, notably leading banks.
“Essentially, it is institutional based rally,” a leading stock analyst Faisal A. Abbas said, adding “tired institutions could not sit idle on their heavy liquid cash and resumed normal business at the lower levels”.
The KSE 100-share index posted a gain of 153.15 points at 12,436.19 as compared to 12,283.23 a day earlier as all the leading base shares ended higher under the lead of MCB, which has 11 per cent weightage in the index and an upper-lock was applied to forestall fresh speculative rise in its share value on technical grounds.
It finally finished with a smart rally of Rs15.20 at Rs319.70 and accounted for 12m shares, the net rise in its share value being five per cent in the session on earning-based perceptions.
The free-float 30-share index showed a sharp rise of 273.28 points at 15,502.00 points on the strength of leading base shares.Analyst Hasnain Ali Asghar hopes the snap rally could be sustained in the coming sessions also but doubts background news from different fronts is not that positive.
But the Tuesday’s snap rally gave a pleasant surprise to most leading market players awaiting a clearer picture on the corporate thinking in the coming sessions, he added.
Investors are, however, worried over the proposed three-day strike by the city transporters to protest the killings of May 12, analysts said, adding “it could take away steam out of the market at least for the near-term signs of which are already visible in the falling volumes”.
Bad news both from the political and law and order front are following in quick successions never allowing investors to plan a long-term portfolio adjustment strategy, analyst Ashraf Zakaria thinks, adding “everybody is awaiting to invest after the political dust settles down”.
The perception that the index will settle somewhere well above the level of 12,500 points appear to be a bit difficult in the developing political situation and investors will think twice to invest even at the falling prices. But some others said it has already survived the shock and is well on the road to set new record.
“There is more than one reasons having bearish impact on the share market, main among them being perception of political uncertainty,” analyst Ahsan Mehanti said, “all the political indicators originating both official and private sources are terribly bearish”.
Many may not like to invest in a bigger way in the share business if the future market outlook linked to capital appreciation is not that encouraging and they will try to put their money somewhere else where it appreciates, he said.
MCB and Siemens Pakistan were leading among the gainers, up by Rs50 and Rs15.20, followed by Javed Omer, Shell Pakistan, Rafhan Bestfoods, JS & Co, JS Global, National Bank, Adamjee Insurance, Fazal Textiles and Packages, which posted gains ranging from Rs5 to Rs13.05.
Lakson Tobacco and Nestle Pakistan were leading among the losers, off by Rs7.90 and Rs26 respectively. Others, which followed them were IGI Insurance, Bhanero Textiles, Faisal Spinning, Haseeb Waqas Sugar, National Refinery, Noon Pakistan, Pakistan Cables and Colgate Pakistan, off Rs2 to Rs7.80.
Trading volume rose to 217m shares from the previous 129m shares as gainers held a strong lead over the losers at 226 to 115, with 36 shares holding on to the last levels.
Bank of Punjab led the list of actives, up by Rs2.65 at Rs107.40 on 16m shares followed by National Bank, higher by Rs7.50 at Rs244.50 on 13m shares, Lucky Cement, firm by Rs1.90 at Rs100.35 also on 13m shares, PTCL, up by Rs1.25 at Rs50.45 on 12m shares, Bank Alfalah, steady by 40 paisa at Rs56.90 on 12m shares and OGDC, higher by 35 paisa at Rs120.10 on 10m shares.
Other actives were led by Telecard, firm by 15 paisa on 9m shares, D.G. Khan Cement, up by Rs1.90 also on 9m shares and Askari Bank, up by Rs1.55 on 7m shares.
FORWARD COUNTER: MCB led the list of actives, sharply higher by Rs15.11 at Rs317.36 on 6m shares followed by National Bank, up by Rs7.71 at Rs244.70 on 5m shares and Bank of Punjab, higher by Rs2.65 at Rs107.75 on 4m shares.
June settlement of MCB was quoted higher by Rs15.01 at Rs315.27, while May contract of Lucky Cement rose by Rs2.05 at Rs100.45 on 3m shares.
The notable feature was that trading also resumed in the June contracts side by side the maturing May settlements.
DEFAULTER COS: Quice Foods came in for active selling at the higher levels and was marked down by 10 paisa at Rs5.60 on 0.319m shares followed by Pangrio Sugar, lower 20 paisa at Rs4 on 0.245m shares and Norrie Textiles, easy by five paisa at Rs1.60 on 0.122m shares. Nimir Chemical was an exception, which rose by five paisa a Rs3.20 on 0.122m shares.
