Market watch: Bourse resumes assault on record highs

Benchmark KSE-100 index gains 106 points.

KARACHI: The Karachi Stock Exchange’s benchmark 100- share index resumed its assault on record highs, as investors continued to accumulate small and mid cap stocks, which apart from announcing stellar earnings for the January to March quarter are priced at discounts on Thursday.

The index, comprising top 100 companies according to market capitalisation, gained 0.56% or 105.94 points to end at 18,885.6 point level. Trade volumes shrunk to 214 million shares compared with Wednesday’s tally of 220 million shares.

The Karachi bourse closed at an all-time high on the back of continuous rally in discounted small and mid tier stocks and better first quarterly results, said Samar Iqbal, head of equity sales at Topline Securities.

“The market continues to trade higher as investors are now discovering value in second and third tier companies that are reporting exceptional results, but are still trading at below market multiples,” reported Muhammad Rawjani, analyst at Elixir Securities.

On the contrary, blue chips continue to suffer because of announcing earnings which are below market consensus and estimates.

Cement sector remained in the limelight after better than expected quarterly announcements from Maple Leaf Cement, Fecto Cement and Pioneer Cement.

Shares of 378 companies were traded on Thursday. At the end of the day 241 stocks closed higher, 101 declined while 36 remained unchanged. The value of shares traded during the day was Rs6.37 billion.

Maple Leaf Cement was the volume leader with 26.28 million shares gaining Rs0.51 to finish at Rs19.36. It was followed by TRG Pakistan with 25.9 million shares gaining Re1 to close at Rs10.3 and Fauji Cement with 13.88 million shares climbing Rs0.07 to close at Rs8.82.

Foreign institutional investors were net buyers of Rs55.78 million, according to data maintained by the National Clearing Company of Pakistan.

For the sessions ahead, analysts expect minimal institutional activity in the market, where volumes and momentum is likely to be driven by small and mid cap stocks. As general elections draw closer, due in less than three weeks, political developments may cause the market to stay volatile.

Published in The Express Tribune, April 26^th, 2013.

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