The KSE 100-share index maintained its upward drive though the week was shortened due to the holidays. The higher corporate announcements helped it to finish with a rise of 60 points after breaching through the crucial barrier of 4,900 points.
The credible performance was achieved at the weekend session which analysts said could be a takeoff point to its forward thrust, perhaps to the next 5,000-point level. This, of course, was possible after a lot of either-way movements which led to various technical consolidation phases.
The breakthrough came in the backdrop of Quetta carnage as investors resumed normal trading activity after mourning the deaths. The KSE 100-share index confidently sustained the level of 4,900 points and managed to finish with an extended gain of 60.06 at 4,900.43 points as compared to 4,840.37 points a week earlier. This lifted the market capital to Rs1,281.00 billion from the previous Rs1,263.00 billion - an increase of Rs18 billion.
There were more positive news from the corporate front and investors discounted the latter as no one among them was in a mood to miss an attractive bait of capital gains and higher payouts.
But an air of uncertainty gripped the market as leading retailers were conspicuous by their absence and financial institutions kept the wheels moving after the Quetta killings in a terrorist attack on an Ashura procession.
A 16 per cent interim dividend by the massively-capitalized Hub-Power for the year ending June 30, 2004, may be on the lower side of predictions but the perception that the final could be much higher did not disappoint prospective investors.
However, a renewed active short-covering in the OGDC seems to have given the needed depth to trading volume and in turn the entire market, because of its size and capital weightage.
"Reports that the OGDC management is planning to launch its Global Depository Receipts (GDRs) on world markets shortly, triggered buystops", analysts said adding, "a further rise in its share value on foreign demand in future is being anticipated".
The PTCL and the Hub-Power, the other two massively-capitalized shares have already floated their GDRs some years back on the world stock markets which were well-received.
The OGDC having a massive capital outlay of Rs50 billion is the largest oil exploration company in the country turning out about a half of the total annual indigenous oil production. It has, over the years, built-up strong profit base, market sources said.
Dividend news, notably from the Millat Tractors which came out with an interim dividend of 80 and 35 per cent bonus shares by Picic were on the higher side of the market expectations, while the final dividend of 25 per cent by the ICI Pakistan did not enthuse the investors.
An interim dividend of 16 per cent by the Hub-Power did not evoke much interest, while, a cash dividend of five per cent plus bonus shares at the rate of 10 per cent by the Meezan Bank, final payout of 70 per cent by the Clariant Pakistan and 10 per cent by the Singer Pakistan were in line with the market perceptions.
After two-day closure, trading resumed on a shaky note as the fears of violence dominated the underlying sentiment. The investors stayed on the sidelines apparently awaiting the reaction to the Quetta carnage. A relative calm, however, brought investors back into the market who made fresh covering purchases on the selected counters.
Energy shares, notably the OGDC and the Sui Northern Gas and some blue chips on other counters led the market resistance to further declines on active support at the dips.
However, early selling only slowed down the market's upward thrust as late covering purchases at the dips allowed it to finish partially recovered from the day's lows on the strength of most of the pivotals.
In similar situations as the prevailing one, investors do unload in part their long positions fearing retaliatory violence but this goes to the underlying market strength which digested confidently the immediate fallout from the killings.
Some leading institutional traders played a key role in keeping the morale of general investors in good shape after having pumped huge amounts of cash in the selected shares, although most retailers stayed out of the market.
The market's uppish leaning persisted despite deaths and injuries to a large number of people in Quetta. The KSE 100-share index managed to finish with a modest increase of 12.05 points at 4,852.46 as compared to 4,840.37 at the last weekend.
The positive effects in the wake of top businessmen's visit to India, and signing of a number of deals to boost the bilateral trade were few factors which helped in containing the hysteria, analysts said.
Positive news from economic and privatization fronts were other agents who helped in reinforcing the investor-confidence in the market in the weeks to come, they said.
Some shares currently under privatization, notably the KESC and some other low-priced ones having a potential of capital appreciation, and also of those whose board meeting are due during the current and the next week were actively traded on the higher side.
Prominent gainers were led by the Abbott Lab, the Rafhan Bestfoods and the Feteh Textiles followed by the Central Insurance, the Bolan Casting, the Clariant Pakistan, the Century Papers, the Security Papers, the Dreamworld, the Burewala Textiles, the Atlas Battery, the Dawood Hercules and others.
The Lakson Tobacco, the Gatron Industries, the IGI Insurance and the Arif Habib Securities were among the top losers. The Unilever Pakistan, the Nestle MilkPak, Javed Omer, the Gul Ahmed Textiles, the Pakistan Tobacco, the Pakistan Refinery, the Shell Pakistan, and many others were among the prominent losers.
Trading volume was on the lower side - owing to a short week because of the Ashura holidays - bulk of which went to credit of the OGDC, the D.G.Khan Cement, the Maple Leaf Cement, the Hub-Power, the PTCL, the PIAC, the Sui Northern Gas, the PSO and some others.
FORWARD COUNTER: Barring the Sui Northern Gas which managed to finish with good gains, all other shares fell under the lead of the PSO which was marked down by Rs8.75 on the late weekend selling. The Hub-Power fell modestly while the PTCL stayed unchanged with the Pakistan Capital Market Fund falling below its face value. Others fell fractionally lower.