KARACHI, July 7: Stocks on Monday ran into profit-selling in an erratic movements but late short-covering in some of the leading shares allowed them to finish partially recovered amid reduced activity.
The early sell-off was attributed to belated reaction to the Quetta massacre and unloading from the carry-over holdings, late revival of demand at the dips on selected counters averted major fall.
An idea of the market’s terribly nervous behaviour may well be had from the highly erratic movements of the KSE 100-share index, which after having fallen to the day’s lowest at 3,439.85 in early trading managed to finish partially recovered around 3,469.58, off 8.28 points.
However, the broader market turned in a credible performance under the lead of textile and synthetic shares followed by ICP mutual funds and leading shares on the other counters barring insurance and energy shares, which came in for active profit-selling at the inflated levels.
Fears that the Quetta killings may turn into sectarian fight between the radical religious groups and its fallout may trigger sellstops from all and sundry sent shock waves in a perfect bull market, brokers said.
The market witnessed a post-Quetta carnage confusion as investors could not precisely decide how to react in the changing but tense political scenario, they said.
All the leading shares including PTCL, Hub-Power, Engro Chemical, ICI Pakistan, Sui Northern Gas, Pakistan Oilfields and several leading secondliners witnessed massive unloadings.
Late short-covering in PSO and some others allowed the market to close with clipped losses thanks to active short-covering at the lower levels. However, being in a highly overbought position owing to the persistent run-up in June, the market needed correction, which came in the form of institutional selling and heavy unloading from the carryover holding.
Technically, the market is still treading on the speculative path as a leading speculators had pushed it too far and lacked support despite some recent positive developments including cut in profit rates of the National Saving Schemes and the $3 billion US aid.
“The market has galloped too far and too fast,” says a leading analyst commenting on the market’s unprecedented rise in June.” The pullback was inevitable in massive badla volume and higher rates.”
But others believe the correction is overdue and the market could shed some other points but bulls are trapped mid-way and may not allow its collapse as widely speculated.
Plus signs held a comfortable lead over the losing ones thanks to late short-covering and ended higher under the lead of Babari Cotton, Ayesha Textiles, Faisal Spinning, Reliance Cotton, Nishat Chunian, Nishat Mills, Al-Abid Silk, Dilon, Crescent Steel, Century Papers and AKD Securities, up by Rs2.25 to Rs5.90.
Trading in the right shares of some ICP mutual funds commenced, which ended higher by Rs1.95 to Rs14.95.
Prominent losers were led by EFU General, EFU Life, Pakistan Resource Co, Island Textiles, Dawood Cotton, Dawood Hercules, Pakistan Oilfields, Pakistan Refinery, Pak-Suzuki Motors, Nestle Milkpak, Attock Refinery, Fazal Textiles, IGI Insurance and Javed Omer, off Rs2 to Rs8.
Trading volume fell to 321m shares from the previous 352m shares but the advancing shares managed to maintain a modest edge over the losing ones at 206 to 163, with 49 shares holding on to the last levels.
Nishat Mills topped the list of actives, higher by Rs2.30 at Rs37.75 on 34m shares followed by Hub-Power lower 30 paisa at Rs37.85 also on 34m shares, D.G. Khan Cement, higher by 90 paisa at Rs31.90 on 31m shares, Dewan Salma, up 30 paisa at Rs19 on 29m shares and PSO, higher by one rupee at Rs235 on 28m shares.
Other actives were led by Bosicor Pakistan, easy 10 paisa on 25m shares, PTCL, lower 15 paisa on 24m shares, ICP SEMF, higher by Rs3.50 on 8m shares, Maple Leaf Cement, firm 10 paisa also on 8m shares and National Bank, off 35 paisa on 7m shares.
FORWARD COUNTER: Hub-Power came in for active selling and fell by 45 paisa at Rs38.10 on 9m shares, while PSO attracted strong support and rose by Rs1.55 at Rs236.50 also on 9m shares.
Nishat Mills remained in strong demand followed by reports of higher sales and rose sharply by Rs2.60 at Rs38.15 on 6m shares. PTCL, fell by 15 paisa at Rs29.05 on 4m shares and Dewan Salman, rose by 40 paisa at Rs19.10 on 3m shares.
DEFAULTER COMPANIES: Active trading was again witnessed on this counter where shares of over four dozen companies came in for active support under the lead of Unity Modaraba,up 10 paisa at Rs2 on 0.239m shares followed by Biafo Industries, higher by 20 paisa at Rs5.50 on 0.193m shares. Indus Polyester rose by 10 paisa at Rs3.30 on 0.136m shares. All others were also actively traded.