KARACHI, Oct 7: Stocks on Tuesday finished reacted as investors played on both sides of the market fearing law and order situation after the assassination of a prominent religious leader and a member of the parliament along with four others on Monday’s terrorist attack.
There was a confusion after the trading resumed as weakholders and short-term dealers hastened to get out of the market after indulging in hasty selling fearing a violent reaction of the followers of the slain leaders. The situation was further aggravated in the absence of matching buying offers at the falling prices.
However, sanity returned to trading after mid-session followed reports of a relative calm in the major city areas, although shops remained closed in some localities but no reports of violence.
The market’s early nervousness was also well-reflected in the erratic movements of the KSE 100-share index. After opening 50 points down, it steadily recovered a good part of the initial losses but mid-session again saw it in the minus column on selling followed by reports of tension in the city.
It finally ended at 4,197.99 as compared to previous 4,214.21, off 16.22 points, eroding Rs4billion from the market capital at Rs920.312 billion.
“Whether or not it was a sectarian killing is yet to be ascertained,” one broker commenting on the assassination of Azam Tariq said, “but it was made to look so by some leading analysts after linking it with the chain of previous sectarian killings.”
However, the market’s inherent strength averted major fall as in most of the cases only extreme gains were pared off but fears of law and order situation are there. What worries investors is that the assassinated leader has a great following and street power and that could create law and order problems for the next couple of session.
“The steep decline in the traded volume apparently reflects this perception as both the bulls and the bears maintained a status quo awaiting further developments on the law and order front rather than indulging in hasty liquidation,” brokers said.
But some others hope the situation is expected to be normal during the next couple of days as investors will be back in the market on the strength of an ambitious disinvestment programme.
“The market is rife with rumours that the final bidding date of the PSO is expected to be announced possibly by the next week as one of the Kuwaiti strategic buyers has indicated to sort out some financial matters with the local officials before that,” analysts said. It rose by another Rs7.40, making the total gain of Rs20 during the last couple of sessions.
The third tranche of 13.131m shares is also being sold on Oct 13, followed by 215m shares of Oil and Gas Development Corporation of Pakistan (OGDCL) at Rs46 and Rs32 per share respectively.
Most of the price changes were fractional as leading investors were not inclined to ride the bandwagon of bears without having taken an objective overview of the developing political scenario and mostly played safe, enabling the market to avert major decline.
IGI Insurance and PSO, which rose by Rs7 and Rs7.40 were leading among the gainers followed by MCB, Jahangir Siddiqui Bank, EFU General, Babri Cotton, Kohat Cement, Pak-Suzuki Motors, Abbott Lab, Murree Brewery after the dividend and bonus shares at the rate of 20 per cent each, BOC Pakistan and Ferozsons Lab, which posted gains ranging from Rs2.80 to Rs5.
Losers were led by Grays of Cambridge and Javed Omer, off Rs14.95 and Rs26.45 respectively. Other prominent losers included Shell Pakistan, Mehmood Textiles, Indus Motors, Millat Tractors, Dawood Hercules, Reckitt and Benckiser, Treet Corporation and Wyeth Pakistan, off Rs2.50 to Rs14.
Trading volume fell 296m shares from the previous 365m shares as losers forced a strong lead over the gainers at 176 to 113, with 35 shares holding on to the last levels.
PSO, topped the list of actives, up Rs7.40 at Rs297 on 43m shares followed by D.G. Khan Cement, steady 20 paisa at Rs43.10 on 40m shares, PTCL, off 45 paisa at Rs37.85 on 26m shares, MCB, higher by Rs2.80 at Rs52.35 on 19m shares and Pakistan PTA, up 25 paisa at Rs12.70 on 18m shares.
Other actives were led by Dewan Salman, off one rupee on 16m shares, Fauji Cement, lower 50 paisa on 13m shares, Lucky Cement, easy 75 paisa on 10m shares, Sui Northern Gas, up 45 paisa also on 10m shares and Faysal Bank, lower 15 paisa on 9m shares.
FORWARD COUNTER: PSO again led the list of active followed by market talk of final bidding date, sharply higher by Rs5.60 at Rs297.25 on 13m shares, followed by PTCL, easy 45 paisa at Rs37.90 on 6m shares, Hub-Power, lower five paisa at Rs36.60 on 5m shares, Pak PTA up 30 paisa at Rs12.80 on 2m shares and Dewan Salman, off one rupee at Rs18.25 also on 2m shares.
MCB rose by Rs2.55 at Rs52.65, while Engro Chemical, Fauji Fertilizer and ICI Pakistan suffered decline ranging from Rs1.20 to Rs1.80 at Rs83.70, Rs94 and Rs83 in that order.
DEFAULTER COMPANIES: Trading on this counter remained dull for the second session where prices showed fractional either-way changes in the absence of strong support from any quarter. Standard Bank was an exception, which came in for modest buying and rose by 20 paisa at Rs6.10 on 0.170m shares.
DIVIDEND: Murree Brewery, cash 20 per cent plus bonus shares of the same amount, Safeway Mutual Fund, bonus shares at the rate of 10 per cent, Sohail Jute, seven per cent, Asset Investment Bank, Amin Fabrics and Colony Woollen, nil for the year ended June 30, 2003.