The Pakistan Oilfields, the Pakistan Petroleum, the PSO, the OGDC followed by the National Bank and some others, being heavy weights, were chief stabilizing factors behind the current price flare-up.
The high dividend and bonus shares by the Bank Al-Habib, the Rafhan Besfoods, PICIC Commercial Bank, the Prime Bank, the Hub Power, the Security Leasing Corporation and some others was another aiding factor.
The KSE 100-share index last week settled well above the 11,000-point level boosted partly by heavy foreign fund buying in oil and bank shares and on higher interim cash and bonus payouts.
The strong presence of foreign funds after the crossing of market capital crossed beyond $50 billion could well prove a sustainable factor in coming weeks, technical corrections here and there, notwithstanding.
We have provided the needed depth ($53 billion) sought by the foreign investors and they must ensure their permanent presence and should not run-way after cashing in on capital gains, said an analyst.
After due corrections, the index is poised to touch an all-time high mark of 12,000 points and what will be next, is pretty difficult to predict at this stage. However, the market crash of the last March may not be relevant to the changed corporate scenario, he added.
However, the higher either-way volatility of the market worried analysts as a change of 200 points in an intra-day trading involved high financial risks.
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But some others ruled out the possibility of a major shakeout at this stage as most of the investors including foreign funds were indulging in intra-day trading which in technical terms minimizes the losses.
After a correction of well over 400 points earlier in the week, it ended with a fresh gain of 299.77 point or 3.5 per cent at 11,352.63 as compared to 11,052.86 at the last weekend as leading base shares rose further under the lead of the PTCL, on the reports of management transfer to Etisalat. The OGDC and the Pakistan Petroleum, which together hold 40 per cent weightage, were aided by fresh oil and gas discoveries.
The index was confidently heading towards its new target of 12,000 points backed by strong foreign buying and higher corporate earnings, analysts said, adding there could be a brief interruption in its sustained run-up on technical grounds but there is a strong possibility of hitting the target.
Based on last week’s performance, the next target now appears not, too elusive, some others said. The talk of the presence of foreign buying in oil did not allow the punters to stay away.
It is pretty difficult to pinpoint the presence of foreign buying in particular scrips as well as its intensity with strong indications of its presence.
Whether or not it is a long-term investment or would it outflow after cashing in on the available margins is not clear but next few sessions will show how it will behave, some others said.
According to market sources foreign asset management funds are waiting the needed depth in the KSE before they enter, some analysts said. The current market capital of about $50 billion seems to have net them in, not for capital gains alone but for long-term investment.
The index is not rising but virtually galloping to its new chart level but no one is sure what is next, brokers said adding there could by a massive correction before it rebounds.
Most of the leading shares, notably in bank and oil sectors have already touched their saturation points and are beyond the purchasing power of a general investor but sympathetic rise in second-liners, which ensures good capital gains are now getting much of the support from those who play safe.
The gainers were led by Sanofi-Aventis, Siemens Pakistan, Attock Petroleum, Pakistan Oilfields, Pakistan Petroleum, the OGDC, Colgate Pakistan, Ferozsons Lab, and many others.
Losers were led by the Nestle Milk Pakistan, the Unilever Pakistan, Fazal Textiles, Shell Pakistan, Dawood Hercules, Pakistan Refinery, Gilltte Pakistan, Wyeth Pakistan, Al-Ghazi Tractors, Rafhan Maize and the Rafhan Bestfoods. But at the fag-end of the week some of them recovered.
FORWARD COUNTER: Speculative issues on the forward counter also followed the lead of their counterpart in ready section despite reports of large outstanding future positions.
Leading gainers were the Pakistan Oilfields, Pakistan Petroleum, the PSO, the OGDC followed by the Telecard, the PTCL, the D.G.Khan, Maple Leaf Cement, and the Fauji Fertiliser.—Mohammad Aslam