KARACHI, Nov 17: Stocks on Monday showed widespread gains followed by strong selective institutional buying, lifting the KSE 100-share index above the barrier of 3,900 points, but leading sellers adhered to the sideline amid predictions of an imminent fresh price flare-up.
News from the political front were not that encouraging as the talk of agitation against the government by the opposition after Eidul Fitr is gaining momentum, but the market seems to responding to its some positive basic fundamentals, including its oversold position.
The much-needed lead was provided by the presence of the financial institutions, which opted for strong buying, but there was no matching selling from any quarter. Trading volume, therefore, remained light.
Energy shares led to the market advance followed by reports of further increase in petroleum prices and expectations of higher earning by both PSO and Shell Pakistan. Reports that the newly-commissioned 5th refinery set up in the private sector near Karachi has resumed commercial operations and has started delivery of petroleum products to PSO for onward sales at the retail outlets also aided the sentiment.
A lot of cash amounts are now free after the closure of OGDC’s sale offer and that has found its way again in the share business though on selected counters, lifting prices of blue chips further higher. Its share came in for strong buying and accounted for about 46m shares, up Rs2.55 at Rs41.20.
An air of optimism prevailed in the rings amid market talk that its issue, being the largest-ever public offering in the KSE history, was massively oversubscribed, pending the 2.5 per cent green shoe option, analysts said.
“Although official subscription figures are not available, it could be well over Rs20 billion on the lower side, signalling that there is no dearth of floating liquidity,” they said.
Its share value currently ruling around Rs41 against the face-value of Rs10 after having touched the pre-IPO high of Rs44, may find its real worth after the actual subscription figures are released by the bankers, they added.
However, one thing is certain that its entry into normal trading list will significantly add to the depth of the market and in turn its viability during the bad times.
The KSE 100-share index breached through the psychological barrier and was last quoted at 3,900.61 as compared to 3,852.79 at the last weekend, reflecting the strength of leading base shares, up 47.82 points. It is speculated that the breach of this barrier will allow it a smooth further upward drive. Market capital also added another Rs9.318bn to the previous total at Rs832.758bn.
“The continuation of its upward thrust will largely depend on the penetration of the resistance level of 3,950, which has coincided with the exhaustion of previous peak levels,” says a leading analyst commenting on the snap rally in a terribly low volume.
Leading gainers were led by Siemens Pakistan, after the announcement of final maintained dividend at the rate of 130 per cent or Rs13 per share, up Rs25 followed by Millat Tractors, AlGhazi and Shell Pakistan, which rose by Rs12.65 and Rs16.55, respectively.
Other good gainers were led by IGI, PSO, Javed Omer, Dawood Cotton, BOC Pakistan, Abbott Lab, Crescent Steel, Dawood Hercules, Pakistan Services and Packages, which posted gains ranging from Rs4 to Rs10.50.
Losers were led by J.W.D. Sugar, EFU General, Atlas Battery, Arif Habib, Exide Battery, Glaxo-SKF, Parke-Davis and Dreamworld, off by Rs2 to Rs11.
Trading showed a modest increase at 123m shares from the previous 76m shares as advancing issues forced a strong lead over the losing ones at 161 to 97, with 35 shares holding on to the last levels.
The most active list was topped by FFC-Jordan Fertilizer, higher by 70 paisa at Rs18.95 on 32m shares followed by PSO, up Rs5.65 at Rs262.75 on 14m shares, Hub-Power, steady by 35 paisa at Rs35.10 on 8m shares, Dewan Motors, higher by Rs1.65 at Rs25.25 on 8m shares and PTCL, up 35 paisa at Rs32.40 on 8m shares.
Other actives were led by D.G. Khan Cement, higher by 85 paisa on 8m shares, WorldCall, firm by 30 paisa on 4m shares, Dewan Salman, higher 35 paisa also on 4m shares, Bosicor Pakistan, up Rs1.50 on 4m shares and Fauji Cement, lower 15 paisa on 3m shares.
FORWARD COUNTER: PSO remained in strong demand for the third session in a row and rose further higher by Rs5.35 at Rs263 on 6m shares followed by FFC-Jordan Fertilizer, up 67 paisa at Rs18.97 on 4m shares, Hub-Power, firm by 30 paisa at Rs35.10 also on 4m shares, PTCL, higher by 20 paisa at Rs32.45 on 3m shares and ICI Pakistan, up Rs1.55 at Rs76.25 on 0.510m shares.
DEFAULTER COMPANIES: Share prices of some leading shares also rose modestly on active short-covering, although there were no large turnover in any of the shares.
DIVIDEND: Siemens Pakistan Engineering, cash at the rate of 130 per cent for the year ended Sept 30, 2003; and International Investment Bank, right shares at the rate of 37.81 per cent at par Rs10 per share.
BOARD MEETINGS: UDL Modaraba on Nov 19; Hamza Sugar Mills on Nov 20; Automotive Battery and Exide Pakistan on Nov 24.