KARACHI, Aug 11: Stocks on Monday took a technical pause as investors played on both sides of the fence rolling positions from one counter to the other but analysts said bears failed to tilt the balance in their favour despite heavy selling in the pivotals.
After rising by 18 points earlier, the KSE 100-share index finally ended lower by 16.63 points at 4,306.30 followed by heavy selling in the leading base shares, notably PTCL and Hub-Power.
PSO followed them as a negative reaction for not fixing the final date of bidding as investors rolled positions to Shell Pakistan ahead of its board meeting on Aug 19 on rumours of higher final dividend plus bonus shares. MCB and Lakson Tobacco whose boards will meet on Aug 16 and 18 also came in for strong demand.
Although minus signs managed to force a strong lead, the prunings were modest in a highly overbought market and did not reflect bulls could loosen their grip on the price line at least for the near-term.
However, the negative fallout of the rumoured failure of the MMA-government talks on the contentious issues of the LFO is still to come as investors are carried over by other positive developments, notably higher corporate results and dividends.
“I don’t think bears could have the field day before the index touches it new chart point of 4,500,” leading stock analysts predict. “Bears should line up massive amounts of hard cash, which they possibly could not, to overrun the bull market.”
The weakness of the broader market and heavy selling in the overvalued stocks reflects that the correction is still far away, they add.
Some others say no one could deny the fact that the market is in a highly overbought position and is sitting on the volcano, which could explode anytime. “How the market will react to the opposition’s independence day rallies and further developments on LFO and their fallout will set the future direction for the market to follow,” he says.
The opening was, however, on the higher side as the KSE 100-share index early was up by 18 points but the mid-session saw heavy alternate bouts of buying and selling as bulls were not inclined to leave the arena and absorbed bulk of the unloading at the dips.
Over the last two weeks, it has risen by about 16 per cent, after breaching successive barriers above the 4,000 point level adding about 65 billion to the market capitalization at Rs958 or about $16bn and needed correction on technical grounds alone.
But the bear onslaught was too feeble to cause major dents in the price structures as bulk of the selling was directed against the volume leaders, PTCL and Hub-Power.
Leading shares maintained their upward drive under the lead of Attock Refinery, Nestle MilkPak, Javed Omer, which rose by Rs8 to Rs15.80 but the largest rise of Rs22.50 was noted in Shell Pakistan on heavy buying at the inflated levels ahead of its board meeting.
Other good gainers were led by Adamjee Insurance, Askari Bank, Burewala Textiles, Pak-Suzuki Co, HinoPak Motors, Fauji Fertilizer and Pakistan Cables, which posted gains ranging from Rs3 to Rs5.45.
PSO and Treet Corporation led the market decline, off Rs9.25 and Rs12 followed by Sapphire Fibre, Pakistan Oilfields, Pakistan Refinery, Honda Atlas, Dawood Hercules, Glaxo-SKF, Atlas Battery and Unilever Pakistan, off Rs3 to Rs15.
Trading volume fell from the weekend all-time record level of 961m shares to 674m shares as losers forced a strong lead over the gainers at 240 to 135, with 48 shares holding on to the last levels.
Hub-Power topped the list of most actives, off one rupee at Rs44.80 on 150m shares followed by PTCL, sharply lower by Rs1.80 at Rs36.40 on 85m shares, Fauji Cement, up Rs1.30 at Rs12.40 on 55m shares, FFC-Jordan Fertilizer, higher by 40 paisa at Rs19.95 on 54m shares and KESC, firm 40 paisa at Rs8.60 on 29m shares.
Other actives were led by Sui Northern Gas, higher by Rs1.85 on 26m shares, PSO, sharply lower by Rs9.25 on 22m shares, PIAC, steady by 10 paisa on 21m shares, Southern Electric, up Rs1.40 also on 21m shares and Bosicor Pakistan, lower 45 paisa on 16m shares.
FORWARD COUNTER: PSO also came in for massive battering on the forward counter, off Rs10.65 at Rs307.95 on 12m shares, while on the other hand MCB, Fauji Fertilizer and Sui Northern Gas, attracted strong support and rose by Rs2.15, Rs2.20 and Rs2.45 at Rs51.60, Rs101.50 and Rs47.25 respectively.
Hub-Power and PTCL were actively traded, off one rupee and Rs1.65 at Rs45.25 and Rs36.90 on 26 and 17m shares respectively. FFC-Jordan Fertilizer rose by 30 paisa at Rs19.95 on 8m shares.
DEFAULTER COMPANIES: Leading shares on this counter also attracted selling under the lead of Biafo Industries and Financial Link Modaraba, easy one rupee and 50 paisa at Rs7.75 and Rs3.75 on 0.286m and 0.169m shares respectively. Islamic Bank on the other hand managed to finish fractionally higher by five paisa at Rs7.30 on 0.307m shares.
DIVIDEND: Al-Meezan Mutual Fund, cash 20 per cent, bonus shares 10 per cent and right shares at the rate of 200 per cent for the year ended
June 30, 2003. The announcement was well-received in the market as was reflected by an increase of Rs1.15 in share value at Rs35.90 on 0.519m shares.
BOARD MEETINGS: Bank Of Punjab on Aug 13, Muslim Commercial Bank Aug 16, Lakson Tobacco, Aug 18 and Shell Pakistan on Aug 19.