Profit-taking ends KSE upward march

Thursday, August 20, 2009

KARACHI - Profit-taking once again changed the upward direction of the Karachi Stock exchange and benchmark 100-share index shed 42 points to close at 7,952 points on Monday. Investors at the market booked profits in oil, banks and fertilizer scrips after disappointed results in oil refineries and banking sector scrips. Low volume strength in the banking stocks did allow the benchmark a positive opening. Strength, however, faced fresh float from the local front thus keeping the resistance of 8090-8097 active. Benchmark did manage positive stance, mainly due to renewed buying interest in the highest beneficiary of a likely resolve of the circular debt issue. Gains in PSO allowed the positivism to prevail while midday stagnation forced massive rate erosion. Switching led red numbers in Oil and Gas exploration sector, wherein the stocks trading at higher multiples witnessed off-loading while the cheaper stocks of the sector continued to invite buying interest at adjusted levels. The KSE-100 index kicked-off the day with a gain of 27.60 points and index was unable to maintain the positive stance.

Benchmark closed the day at 7,952.70 points, showing a loss of 42.40 points. Trading activity slightly improved as compared to the last trading session. The market turnover stood at 122.952 million shares on Wednesday as compared to last trading session s 106.865 million shares on Tuesday. Total trading value of the KSE increased to Rs 7.25b against last session s Rs 5.47b. Market men remained concerned over falling corporate earnings, rise in leverage costs and lack of leverage availability in the market. Moreover, rise in cement export figures this month and rise in international oil prices failed to support the overbought market , stated research analyst Ahsan Mehanti. Market capitalisation moved down to Rs 2.343tr as compared to Rs. 2.354tr of last trading session. Out of 382 active stocks at the Karachi stock market, at least 169 advanced, 193 declined while the worth of the shares of 20 cos remained unchanged.Immense selling in banking stocks, still in grip of NPL phobia, did push the index in the negative territory. Cement export numbers, however, invited buying interest in the main board stocks of the sector, thus pulling the sector out of CCP and low local demand phobia, textile stocks and low price stocks of the sectors likely to outperform the economy witnessed accumulation with decent turnover, thus indicating likely rally in upcoming sessions.

The unconfirmed news that the local bourses will be re-considered for inclusion in MSCI next year was actually a negative development, as previously the inclusion was scheduled in September this year, its seems that shallowness led price erosion mainly due to low turnover , said market expert Hasnain Asghar Ali. DGKC proved itself a true volume leader and remained on the top with the trading of 23.103m shares on Wednesday, followed by PTCL with 10.135m shares, Lucky Cement 8.923m shares, Pak Oilfields 8.653m shares, ODGC 7.224m shares, NML 5.260m shares, NBP 5.062m shares, AHSL 3.3m shares, ANL 3.187m shares, MCB 2.962m shares namely. Top gainers at the stock exchange include Fazal Textile, up by Rs12.87/share to close at Rs363.87 with the trading of only 15 shares, Pak Services gained Rs8.85/share, closing at Rs178.88, Siemens Pak Engineering added Rs8.33/share and its total value was improved to Rs1,110, Indus Motor up by Rs6.80/share and closed at Rs142.89, Clariant Pak added Rs6.03/share to close at Rs126.80. On the other side, Wyeth Pak lost massive Rs66.30/share to close at Rs1,259.81, Treet Corporation down by Rs27.41/share and its value was decreased to Rs533.59, Bata Pak down by Rs27/share and closed at Rs705, Nestle Pak lost Rs10/share, closing at Rs1,130 with a small turnover of only 4 shares, Sanofi-Aventis down by Rs7.59/share to close at Rs144.39.

(The Nation)