KARACHI, July 17: Stocks extended the rising streak on Tuesday with the KSE-100 index gaining 60.70 points to close at 14,445.28 points. The trigger was the investors’ expectations of healthy results and payout from companies about to unveil results for the second quarter.
Investors were looking forward to hefty payout from Hubco to mitigate the effect of earlier depressing results posted by the Fauji Fertiliser Bin Qasim.
Stock broker Siddiq Dalal said that he did not expect any upheaval in political stability. Investors were buying in selective scrips on the fundamentally sound sectors, particularly the cement and energy.
However, he ruled out across the board value rise. Volumes were expected to remain low as the trading timings were reduced during the holy month of Ramazan.
Dalal believed that improvement in law and order situation, lower interest rates, political stability and the strength of the rupee against the dollar were the factors that could help induce activity in the stock market going forward. But many analysts thought that 14,500 points could prove a strong resistance for the bulls.
The encouraging fact was resumption of foreign portfolio inflow. On Tuesday, foreign investors bought shares worth net $1.65 million. Banks kept building portfolio with buy of stocks valued at $1.61 million. Individuals, however, went in for profit-taking by the sale of $2.06 million worth stocks.
Ahsan Mehanti at Arif Habib Corp commented that activity remained thin as investors awaited Supreme Court reaction on NRO judgment implementation next week.
Institutional support was seen in blue chip stocks in oil, banking and cement sectors ahead of release of US Coalition Support Fund of $1.5 billion despite concerns for security situation in the city.
Hasnain Asghar Ali, COO at Escorts Capital, said that in terms of high volume, D.G. Khan Cement was joined by various mid-tier and frontline banking stocks mainly on earnings outlook for the second quarter.
Overall turnover improved as investment companies and low prices stocks came in for trading. Fertiliser sector witnessed stock swapping where the companies likely to show lower earnings due to gas shortfalls faced institutional selling while growth stocks saw fresh inflow of funds, thus keeping the equation balanced. The presence of prospective participants on the sidelines however continued to keep the chances of improved activity on both value and volumes alive.
However, until things clear out selective and conservative approach was recommended as the post result sell-off has been prominent in the current result season.
Samar Iqbal, equity dealer at Topline Securities, stated that with the commencement of the result season, investors started taking position in anticipation of healthy earnings and handsome payouts. Profit-taking was seen in Engro Foods after its half yearly earnings announcement.
The KSE-30 index rose by 89.34 points to 12,534.58 points. Among the 371 active stocks on Tuesday, 166 closed firm, 106 were easy and 99 remained unchanged.
Turnover improved to 105 million shares of the trading value of Rs4.018 billion, up from 74 million shares valued at Rs2.922 billion. Market capitalisation saw addition of Rs14 billion to Rs3.685 trillion, from Rs3.671 trillion.
On the active list, Jah Sidd Co with a turnover of 13m shares, up by 63 to Rs14.66, displaced the D.G. Khan Cement which stepped down to the second place among the top 10 volume leaders.
DGK Cement with turnover of 13m shares rose by 28 paisa to Rs44.92. Lotte PakPTA climbed 39 paisa to Rs7.56 on 9m shares, Engro Foods on 8m shares, plunged by Rs2.16 to Rs67.66 on earnings announcement, the company skipped payout with the six months earning per share at Rs1.35.
Lucky Cement gained Rs1.71 to Rs128.34 on 4m shares, Askari Bank added 66 paisa to Rs15.00 on 4m shares, NBP climbed 44 paisa to Rs45.42 on 3m shares, NIB Bank edged higher by 2 paisa to Rs2.40 on 3m shares, UBL recorded good gains of Rs1.73 to Rs88.89 on 2m shares and Lafarge Pakistan, the third active stock on the cement sector, added 6 paisa to Rs4.67 on 2m shares.