KARACHI, March 27: Active profit-selling in OGDC triggered by reports of an increase in its wellhead gas prices by the Oil and Gas Regulatory Authority (Ogra) drove the entire market into the minus column owing to its massive weightage in the KSE 100-share index.
Although all other leading base shares, notably on the oil counter, and National Bank managed to finish with extended gains, weakness of the cement shares, notably DG Khan and Lucky Cement also weighed against the underlying sentiment, but analysts predict the jolt is temporary caused by market’s technical demands.
Insurance shares on the other hand did not toe the market’s general trend and showed smart gains followed by higher cash dividend and bonus shares. Apparently, the managements of companies have passed on a good part of capital gain tax exemption benefit to its shareholders.
Stocks, therefore, suffered modest pruning at the inflated levels but there appears to be nothing wrong in the corporate news on which technical correction could feed on in the subsequent sessions.
The KSE 100-share index showed a fall of 57.47 points at 11,402.11 after hitting the session’s high of 11,572.23, owing to selling in OGDC amid reports that Ogra has revised upward its gas wellhead price and some other leading base shares.
But active short-covering in PTCL, National Bank, Pakistan Petroleum and Pakistan Oil Fields by some foreign investors limited the market fall.
“I don’t see a major sell-off as quarterly results of some of the leading companies are overdue, which could attract a lot of fresh covering purchasing in the sessions to come,” Hasnain Asghar Ali, a leading stock analyst, predicts.
But Faisal Abbas, another analyst, says the selling, which remained essentially confined to OGDC, came from a foreign investor who had built up a long position in it a week earlier.
However, it appears to be a part of his portfolio adjustment rather than any other bad news from the oil sector, which is expected to keep the entire market in a positive mood, he added.
“The rollover amounts for maturing March contracts at Rs15.5 billion are on the lower side and may not be a bearish factor, some of the leading punters made it look so to set in profit-taking in an overbought market,” Zia Javaid, another leading equity analyst, said.
Most analysts say that the market had already digested the negative fallout of external news, notably from Balochistan and tribal areas and so long as oil shares remain an envy of foreign investors there is no reason to believe to be bearish.
The recent oil discoveries and increase in oil and gas production in the existing fields has made the oil sector a major speculative counter and foreign investors are expected to remain active players in them having positive impact on the broader market, they said.
Major gainers were led by EFU Life Insurance and EFU General, up Rs10.45 and Rs11.45, respectively, on higher cash dividend and bonus shares, followed by IGI Insurance, Muslim Insurance, Premier Sugar, Millat Tractors, Pakistan Petroleum, Arif Habib Securities and Jahangir Siddiqui Capital Market Fund, up Rs5 to Rs10.45.
Pak-Suzuki Motors, on post-dividend (50 per cent) selling, and Sanofi-Aventis fell by Rs13.25 and Rs17.90, respectively. Other losers included Attock Refinery, Attock Petroleum, OGDC, Gillette Pakistan, Dawood Hercules, Central Insurance, Gatron Industries and Siemens Pakistan, which suffered declines ranging from Rs5.20 to Rs12.50.
Trading volume soared to 429m shares from the previous 396m shares, but losers forced a strong lead over gainers at 205 to 141, with 42 shares holding on to the last levels.
OGDC came in for active selling and fell by Rs6 at Rs156 on 93m shares, followed by PTCL, higher by Rs1.30 at Rs66.45 on 66m shares, Pakistan Petroleum, up Rs7.50 at Rs276 on 39m shares, DG Khan Cement, lower 75 paisa at Rs151 on 36m shares, Pakistan Oilfields, higher by Rs2 at Rs623 on 27m shares, Lucky Cement, easy Rs1.55 at Rs119.20 on 24m shares, and National Bank, higher by Rs3.85 at Rs280.35 also on 24m shares.
Other actives were led by Fauji Fertilizer Bin Qasim, steady 10 paisa on 15m shares, Sui Southern Gas, up Rs1.95 on 13m shares and Bosicor Pakistan, lower 75 paisa on 11m shares.
FORWARD COUNTER: OGDC also came in for active selling on this counter and fell by Rs5.65 at Rs157.40 on 34m shares, Pakistan Petroleum, higher by Rs6.20 at Rs276 on 21m shares, and Pakistan Oilfields, higher by Rs1.05 at Rs623.45 on 13m shares.
PTCL led the list of other actives, up Rs1.29 at Rs66.49 on 10m shares and Lucky Cement, lower Rs1.15 at Rs119.60 on 8m shares. The notable feature was that trading also resumed in the April settlements side by side the maturing March contracts.
DEFAULTER COS: Trading activity on this counter remained slack as investors played safe owing to setting in of correction in the ready section. Price changes were mixed and mostly fractional as there was no report of a big deal in any of the current favourites.
DIVIDEND: New Jubilee Insurance, cash 30 per cent, bonus shares 20 per cent; Central Insurance, cash 20 per cent, bonus shares 10 per cent; Habib Insurance, cash 35 per cent, bonus shares 30 per cent; Pak-Suzuki Motors, cash final 50 per cent; Altern Energy, right shares 1,450 per cent.