KARACHI, Oct 17: Stocks on Wednesday resumed their upward drive boosted by good corporate announcements from Hubco and PSO and credible performance turned in by the textile sector followed by reports of 15 per cent increase in textile export quota and a custom duty waiver by the European countries.
Most of the hereto sluggish textile shares rose in unison under the lead of leading among them and being the largest sector of the listed shares led the market to a broad recovery.
The perception that export losses because of Afghan war may be in part compensated induced investors to take new positions on this counter at the prevailing lower rates adding to the strength of the underlying sentiment.
After having breaching through the barrier of 1,250.00 point, the KSE 100-share index failed to sustain it because of late selling in some of the pivotals and closed with a clipped gain of 14.36 points at 1,245.44.
However, the general perception is that it is heading to hit the level of 1,300 points, of course after due corrections, aided by the developing economic scenario and the greater inflow of dollar here in various forms.
Massive activity of 91 million shares in Hubco followed by reports that its lenders have approved the interim dividend of 17 per cent again featured the stock market trading on Tuesday as it evoked broad-based rally on other selected counters.
Market talks that the approval has paved the way for the final dividend which could be of any amount triggered buystops in its share at the lower levels. Its previous final dividend was 70 per cent.
But the final payout at the rate of 60 per cent by the Pakistan State Oil (PSO), making the total to a maintained 100 per cent seems to have fallen below the market expectations as was reflected by the late selling in its share, eroding Rs.2.15 from its overnight rise.
The late selling in its share was caused owing to the omission of bonus shares, which the investors were expecting at the rate of 20 per cent.
However, the reaction in PSO appears to be more speculative than real as the 100 per cent cash dividend or Rs.10.00 on a 10-rupee share is a fair return for the investors or those who have a stake in it, says a leading floor broker.
PSO sales for the year ended June 30,2001, soared to an all-time record high of Rs.143.306bn from the last year’s comparable figure of Rs.102.466bn, showing a big increase in its market share of petroleum products.
Stock analysts said although the rally was broad-based, the major investor interest remained confined to the two pivotals for obvious reasons including the rumours of dividend.
“Both the shares, still ruling far below their pre-reaction levels have the potential to rise at least to their former peak on the strength of their working results and that is perhaps why investors are covering positions at the lows”, they added.
Plus signs dominated the list under the lead of Adamjee Insurance, Gadoon Textiles, Sapphire Fibrem Sapphire Textils, Suraj Cotton, Glaxo-Wellcome and Millat Tractors, which posted gains ranging from Rs.2.15 to 4.00.
Other leading shares, which rose included A.A. Textiles, BOC Pakistan, ICI Pakistan, Cherat Paper, Treet Corporation, Javed Omer and Mitchell’s Fruits, up Rs.1.25 to 3.00.
Barring Attock Refinery and PSO, which fell by Rs.2.00 to 2.15, other losses were fractional and reflected lack of support rather than large selling.
Trading volume swelled to 177 million shares from the previous 149 million shares as the advancing shares held a strong lead over the losers at 123 to 47, with 36 holding on to the last levels, out of the total 206 actives.
Hubco again topped the list of most actives, up 85 paisa at Rs.18.05 on 90.700m shares followed by PTCL, firm by 10 paisa at Rs.15.60 on 49m shares, PSO, off Rs.2.15 at Rs.103.10 on 6m shares, Engro Chemical, up 40 paisa at Rs.48.70 on 5m shares and Dewan Salman, higher 60 paisa at Rs.13.70 on 4m shares.
Other active were led by Nishat Mills, higher by Rs.1.60 on 3.580m shares, Adamjee Insurance, up Rs.2.15 on 2.437m shares, Fauji fertiliser, firm 40 paisa on 2.187m shares, Sui Northern, steady five paisa on 2.102m shares and MCB, up 45 paisa on 2.019m shares.
FUTURE CONTRACTS: Bulk of the activity remained confined to PTCL, which rose by 15 paisa at Rs.15.65 on 3.335m shares followed by PSO, off Rs.2.20 at Rs.103.30 on 0.318m shares.
Dewan Salman, Hub-Power and Nishat Mills were leading among the gainers, rising by Rs.1.05 to 1.10 at Rs.14.25,18.20 and 14.50 respectively.
DEFAULTER COMPANIES: Allied Motors and Colony Textiles came in for active support and were quoted unchanged at Rs.9.00 and lower 15 paisa at Rs.3.30 on 5,000 and 8,000 shares respectively.
DIVIDEND: Agriautos, cash five per cent, Moonlite Pakistan, nil for the year ended June 30, 2001.
BOARD MEETINGS: Lawrencepur Woollen on Oct 18, Trust Leasing, Cherat Cement and Cherat Papersack, all Oct 25 and Pak-Gulf Leasing Oct 26.