KARACHI, March 15: The KSE 100-share index on Tuesday confidentially breached through the crucial barrier of 10,000 and stood well above it at 10,303.13, heralding the advent of foreign buying, and analysts said the sky now could be the limit.
Despite negative comments on the persistent meteoric rise, notably after the breach of 8,000 and 9,000 barriers, the index never looked back and finally allayed fears of a massive shakeout any time in an artificially propelled rise but it proved the major breakthrough in based on some sold financial facts.
It finally finished close to the day’s peak level at 10,303.13, up 305.08 points or 3.05 per cent as compared to 9,998.05 a day earlier, reflecting the strength of leading base shares under the lead of OGDC, which has now assumed the role of a trendsetter.
“It was a judicious blend of both foreign and local buying on selected counters, which in turn evoked heavy sympathetic buying on the other counters, intensifying the bull-run,” analysts said.
The recent visit of the Merrill Lynch M.D. to the KSE and his discussions with the high-ups seems to have sent positive signals among the local brokers amid reports that it has already entered the market and made selective buying.
The other positive development is the depth of the market measured by its market capital, which is now around $50 billion and provides a level-playing ground for the foreign investors. The recent comments of the chief of the New York Stock Exchange on the credible performance of the KSE and its capital base was another pointer for the advent of foreign fund buying, some others said.
The breach of the index level of 10,000 is significant in more than one ways. On one hand, it ended the speculation whether the current unprecedented rise is genuine or speculative and provided attractive bait to foreign investors on the other hand.
“Pakistani stock market is a typical example where investors opted from dividend yields to price-earning multiples, which are now in the driving seat,” analysts said.
And that could lead the way to new records in the coming months, some technical corrections here and there notwithstanding, as all indicators point to continued bull-run.
“Since January this year, the market has already risen by about 61 per cent and it appears pretty difficult to jolt it down from the current peak levels,” says a leading broker.
Leading gainers were included OGDC, AKD Securities, Treet Corporation and Aventis, up Rs13.20 to 28.30, followed by Clariant Pakistan, ICI Pakistan, Indus Motors, Engro Chemical, PPL and IGI, which posted gains ranging from Rs7.05 to Rs10.
Losers were led by Attock Petroleum, Colgate Pakisan, Unilever Pakistan, Grays of Canbridge, Nestle MilkPak, off Rs10 to Rs25.95 but the largest fall was noted in Wyeth Pakistan, which was marked down by Rs58. Gadoon Textiles, PNSC, International Industries, Attock Refinery and Gatron Industries also suffered fall ranging from Rs4 to Rs9.50.
Trading volume fell to 632m shares from the previous 676m shares as losers held a modest lead over the gainers at 197 to 179, with 41 shares holding on to the last levels.
OGDC again topped the list of most actives, sharply higher by Rs13.20 at Rs189.75 on 168m shares, followed by Pak PTA, up Rs1.50 at Rs14.55 on 71m shares, DG Khan Cement, firm by 80 paisa at Rs80.80 on 58m shares, Fauji Fertilizer Bin Qasim, up 80 paisa at Rs40.70 on 43m shares, National Bank, higher by Rs2.25 at Rs164.75 on 34m shares, and Bank of Punjab, higher by Rs3.60 at Rs109.80 on 21m shares.
Other actives were led by PIAC, firm by 35 paisa on 16m shares, Sui Northern Gas, off Rs1.90 on 15m shares, Dewan Salman, up Rs2.30 on 14m shares, and Hub-Power, steady by 35 paisa also on 14m shares.
FORWARD COUNTER: OGDC was massively traded on this counter as well, sharply higher by Rs13.50 at Rs193.60 on 170m shares, followed by PPL, up Rs11.90 at Rs323 on 103m shares, Fuaji Fertilizer Bin Qasim, higher by Rs2.90 at Rs42.10 on 43m shares, PTCL, lower Rs1.15 at Rs89.05 on 35m shares and PSO, higher by Rs9 at Rs494 on 25m shares. ICI Pakistan and Engro Chemical were among the other leading gainers, up Rs4.20 to 9.80, while Fauji Fertilizer fell by Rs4 among the blue chips.
DEFAULTER COS: Crescent Standard Bank again led the list of active, up 65 paisa at Rs16.70 on 0.396m shares followed by Dandot Cement, lower 25 paisa at Rs12 on 0.107m shares.
DIVIDEND: Parke-Davis, cash 200 per cent or Rs20 per share, Kohinoor Energy, interim 125 percent, Silver Star Insurance, and Bank Alfalah, final nil, 25 per cent bonus and identical amount right shares already announced.
BOARD MEETINGS: Askari General Insurance, on March 19, Wyeth Pakistan, Dawood Hercules, on March 21, New Jubilee Insurance on March 22.