KARACHI, May 16: The relentless rally for the 11th straight sessions came to a halt on Thursday as the bulls took a breather. The KSE-100 index pulled back by 150.09 points or 0.73 per cent to close at 20416.60 points.
There were several sectors and stock-specific factors that dragged down prices of blue chip heavy-weights. Except for two, all the other ‘oil & gas’ heavyweights lost values. Pakistan State Oil (PSO) was down by Rs5.62 or 2.3 per cent after the MSCI semi-annual review where MSCI removed the country’s largest oil marketing company from MSCI Frontier Market (FM) and added it to MSCI FM Small Caps.
Resultantly Pakistan’s total weight in MSCI FM stood down from 4.46 per cent to 4.24pc. The highest weighted stock in the index, OGDC dropped by Rs1.48 or 0.7 per cent. After five consecutive ‘upper caps’ in MCB Bank that saw its price jump by around Rs50, the Mansha group banking stock finally came under profit taking, which saw its price dip by Rs12.78 on Thursday.
On the flip side, UBL rose to its ‘upper circuit’ with gain of Rs4.98 as investors were said to be attracted by its cheaper price-to-book multiple of 1.5 times.
The figures released by the National Clearing Company of Pakistan showed heavy buying by both the foreign and local investors. Foreign inflow on Thursday amounted to $11.72 million, including the buy-back of stocks held by shareholders in Unilever Pakistan by the parent Unilever Overseas.
Among the locals, ‘companies’ bought stocks valued at $2.19 million. Individuals and other organisations also were net buyers of $4.36 million and $5.15 million worth stocks on Thursday.
Banks took profit by offloading shares worth $2.13 million and mutual funds followed suit with sale of stocks worth $2.27 million.
Analyst Ovais Ahsan said that the post election rally took a breather on Thursday as overbought momentum took its toll on the bulls. Post election euphoria faded as investors weighed the difficult challenges faced by the government-in-waiting including discussions with the IMF for a new loan, dwindling foreign exchange reserves, a crippling power crisis and terrorism.
However, Ovais and other analysts argued that the undertone of the market remained bullish as receding political uncertainty in the face of relatively peaceful atmosphere and a strong single party dominated government would be the policy making authority, which should make implementation theoretically more efficient.
In all, 389 stocks came up for trading on Thursday, with plus and minus signs about even at 177 and 181, respectively.
Volume of business settled lower by 23 per cent to 324 million shares, from 419m shares traded a day ago. Trading value also plunged by 31 per cent to Rs8.399 billion, from Rs12.119bn. Market capitalisation decreased by Rs28 billion to Rs4.967 trillion, from Rs4.994tr.
On the volume leaders’ list, Japan Power saw business in 36 million shares with the stock gaining 46 paisa to Rs3.48. It was followed by another third-tier Independent Power Producer (IPP) Southern Electric up by 61 paisa to Rs3.18 on 34m shares.
Bank of Punjab dipped by 80 paisa to Rs11 on 16m shares, PIA rose by 63 paisa to Rs6.75 on 14m shares, NIB Bank edged higher by 7 paisa to Rs2.51 on 12m shares, Azgard Nine gained 40 paisa to Rs7.10 on 12m shares, KESC shed 17 paisa to Rs6.09 on 12m shares, Fauji Cement was down 6 paisa to Rs10.47 on 10m shares, Maple Leaf Cement was up by 28 paisa to Rs19.35 on 9m shares and Pakgen Power saw addition of 27 paisa to Rs20.41 on 8m shares.