0
KARACHI, Aug 22: Stocks on Monday finished with an extended gain on strong follow-up support aided by the perception that the acceptance of major demands of bourses by the SECP after the prime minister’s intervention could give the needed push to share trading in the coming weeks.
The introduction of continuous fund system, a modified form of badla financing making available enough liquidity for the investors for a smooth trading after a protracted bearish spell, appears to be one of the instant morale boosters for investors who flooded the market by buy-stops.
The KSE 100-share index recovered another 278.18 points or 3.80 per cent, raising the tally to eight per cent during the last two sessions, as leading base shares virtually raced towards their pre-reaction levels on strong genuine and speculative buying appears to be the chief morale booster behind the sustained rise.
The market’s bullish trend was also reflected in the index, which ended the session after having breached two consecutive psychological barriers at 7,590.10, as buying euphoria at the current lower levels remained unsatisfied till the closing bell, adding Rs77.384bn to the market capital at Rs2,167.722bn.
Leading base shares, notably PTCL, OGDC, National Bank, PSO, Pakistan Petroleum, Pakistan Oilfields and some others were trend setters and rose sharply higher from the current lower levels.
The market has demonstrated in more than one ways that it could rise to any high on good news as there is no dearth of buyers at the dips.
An air of optimism prevailed on the market as all the major demands of the stock exchanges were met though a bit late and after a lot of mess, which eroded billion of rupees from the market capital.
An addition of seven scrips under the orbit of continuous fund system (CFS), including Pakistan Petroleum, MCB, Bank of Punjab, SUI Northern Gas, Pak PTA and Fauji Fertilizer Bin Qasim, and an increase of upper limit of financing under it to Rs25 billion, are some of the main stimulants agreed upon between the SECP and the bourse chiefs.
The CFS will be used as a bridge to cross over to other modes of share financing, notably margin financing and derivatives. Initially, it will be available on the pattern of COT and after the close of the market, but it will run parallel to the ready market trading houses later.
“I think the worst is over now and the market should respond to its positive basic fundamentals,” predicts a leading stock analyst. ”Market’s performance during the last two sessions reflects that bulls are already at the helm of the affairs.”
Although plus signs were strewn all over the list as investors covered positions at the lower levels for capital gains, the largest rises of Rs17.05 and Rs20 were recorded in Arif Habib Securities and Shell Pakistan.
Other prominent gainers were led by Pakistan Petroleum, Ferozsons Lab, National Foods, Glaxo-SKF, National Refinery, PSO, Pakistan Oilfields, and Atlas Honda, up Rs8.30 to Rs14.60. There were many other good gainers also on all the counters, notably banks.
Colgate Pakistan and Unilever Pakistan were leading among losers, off by Rs7.50 and Rs24, respectively. Other notable losers included Dawood Hercules, after the announcement of lower than market expectation interim cash dividend of 15 per cent, Husein Sugar, Pakistan Refinery, and Gatron Industries on post-dividend selling.
The trading volume soared to 328m shares from the previous 194m shares as gainers maintained a strong lead over losers at 248 to 94, with 30 shares holding on to the last levels.
The most active list was topped by PTCL, higher by Rs2.65 at Rs66.25 on 96m shares, followed by OGDC, up Rs4.65 at Rs110.05 on 77m shares, Bank of Punjab, up Rs4.25 at Rs89.35 on 19m shares, Pakistan Oilfields, higher by Rs15.75 at Rs331 on 16m shares, National Bank, firm by Rs4.75 at Rs107.55 also on 16m shares, PSO, higher by Rs13 at Rs383.70 on 16m shares, and Fauji Fertilizer Bin Qasim, steady by Rs1.55 at Rs32.95 also on 16m share.
Other actives were led by Pak PTA, higher one rupee on 8m shares, DG Khan Cement, firm by Rs2.75 on 7m shares, and Fauji Cement, up one rupee on 5m shares.
FORWARD COUNTER: Most of the leading shares on this counter finished on odd losing, reflecting an apparent effort by a section of operators to forestall further trading in them.
PTCL also led the list of actives, up Rs2.52 at Rs66.37 on 24m shares, followed by OGDC, up Rs4.80 at Rs110.40 on 17m shares, Pakistan Oilfields, higher by Rs15.79 at Rs331.60 on 9m shares, and PSO, up Rs11.80 at Rs384.20 on 6m shares.
The notable feature was that trading also resumed in the September settlements side by side the ruling August contracts. Prices of other shares also rose under the lead of Bank of Punjab, MCB, National Motors and others.
DEFAULTER COS: Share values also rose in sympathy with the ready counter, major gainers being Trust Brokerage, Automotive Battery and Ghandhara Diesel, up by one rupee to Rs1.45 at Rs10.90, Rs14 and Rs32.45, respectively. But turnover was light in all the shares.
DIVIDEND: Clover Pakistan 65 per cent; Pakistan Papersack, final 40 per cent, interim of 20 per cent already paid; Gatron Industries, cash 30 per cent; Dawood Hercules, cash interim 15 per cent; Mybank, right shares at the rate of 35 per cent; and Meezan Bank, right shares 20 per cent.
BOARD NEETINGS: Bank al-Habib, on Aug 24; New Jubilee Insurance, Glaxo-SKF, Merit Packaging, PIAC, Askari General Insurance and Muslim Insurance, on Aug 25; American Life Insurance, Pak-Suzuki Motors, Atlas Investment, on Aug 26; BSJS Balanced Fund, Aug 27; and Atlas Investment Bank, Aug 30.
