Karachi bourse manages to recover 92 points

Friday, March 05, 2010
By By our correspondent
KARACHI: Technical buying on this year lower level helped the Karachi bourse restore above the 9,500-point level on Thursday.

The notable foreign portfolio investment remained the primary source of recovery in this session as well. KSE 100-share index regained by 92.10 points or 0.98 per cent and closed at 9,511.53 points.

By yesterday (Wednesday), the market had declined to the level on which the first session of the year 2010 was closed near 9,400 points in the result of continuous sell-off in the previous sessions.

The parallel running junior 30-share index also recovered 119.07 points or 1.21 per cent during the session and concluded at 9,968.78 points. Analysts were of the view that share prices had declined to lucrative levels so that some of the participants opted to accumulate stocks along with overseas investors. The buying was noted on across the board where the National Bank led the list of volume leaders, as this scrip announced better than expected earning for the year ended on December 31, 2009.

After quite a long time, the National Bank played its traditional role in heavy weight counter and included 17.50 points on the key benchmark 100-index. Among others, almost all the blue-chips attracted funds and managed to revert into the positive territory.

Analyst Ahsan Mehanti said the bullish activity witnessed as NBP announced a record result announcement. Growing foreign interest in local markets, rise in international oil prices near to $81 a barrel and expectation of early appointment of finance minister altogether played a catalyst role in positive activity despite profit-taking by valued institutions throughout the session. Analyst Farhan Seth said the net foreign buying worth $17.5 million in the last four sessions (including this one) triggered the sentiments. Underperforming scrips like JSCL, ANL and AHSL remained in limelight where NBP was the volume leader owing to better than expected financial result announcement this session.

Local companies, however, appeared as panic sellers of the session with an aggregated sell-off worth $5.42 million, according to NCCPL, bank/Development Financial Institutions (DFIs) were the other prominent buyers with net $1.51 million after foreigners.

Accordingly, the overall market capitalisation increased by Rs27 billion to stand at Rs2,721 billion. The day turnover improved to 160.83 million shares from 115.86 million shares changed hands yesterday. Turnover in the future market also rose to 4.58 million against 3.79 million shares traded a day earlier. Analyst Hasnain Asghar Ali termed the day recovery technical pullback. In the first half of the session, the bearish trends had prevailed. As feared, the stocks held as collaterals continued to make their way into the local bourse even at rates below their ‘nuisance value’, smelling the opportunity the corporate participants and high net worth came in and made their presence felt.

Those stocks, which had lost their values miserably and available at low multiples with offering decent yields attracted fresh funds, thus triggering short-covering. The activity allowed the benchmark to minimize accumulated losses and returned to the positive zone. Gloomy horizon, however, restricted the surge, thus indicating the probable sellers on strength, Ali added.

Out of total 388 active stocks, 221 stocks advanced, 149 stocks declined, while the value of remaining 18 stocks closed unchanged. Highest volumes were witnessed in National Bank at 29.20 million closing at Rs92.55 with a gain of Rs4.35, followed by JS Company at 13.88 million closing at Rs22.10 with a gain of Rs1.05, Lotte Pakistan at 10.75 million closing at Rs9.85 with a gain of 57 paisa, Azgard Nine at 10.13 million closing at Rs16.87 with a gain of Re1, and Fauji Fertilizer Bin Qasim at 10.07 million closing at Rs31.12 with a gain of 51 paisa.