Weekly review: Market rises marginally in stock-specific trading
The Karachi Stock Exchange benchmark 100-share index ended the week marginally higher by 0.25 per cent at 12,462 points. Average daily volume plummeted 50 per cent to 117 million shares.
The market followed its practice of profit-taking in stocks right after the result announcement. Most of the results were in line with market expectations, according to BMA Capital.
Amongst major blue-chip companies, Attock Petroleum, Pakistan Oilfields, Pakistan Petroleum, Fauji Fertiliser Company, Fauji Fertiliser Bin Qasim, National Refinery, Attock Refinery, Lotte Pakistan PTA and Attock Cement reported their earnings during the week.
The State Bank of Pakistan (SBP) on Saturday decided to leave its key policy rate unchanged at 14 per cent for the subsequent two months.
Foreigners stand strong
Foreign inflows continued to remain in the positive territory and stood at $6.32 million for the week compared with last week’s $14.7 million, said BMA Capital research team in a research note.
On the local front, individuals remained major sellers with a net selling of $7.67 million followed by corporations while development finance institutions (DFIs) were among major buyers, the research note added.
Key sectors remain laggards
All key sectors including banks, oil and gas and telecoms ended as underperformers. The automobile sector also remained under pressure following the federal cabinet’s decision allowing import of up to five-year-old cars.
Despite healthy results reported by two leading fertiliser makers and rise in di-ammonium phosphate (DAP) prices by Rs100 per bag announced by Engro, investors chose to book profits in key fertiliser stocks. However, the fertiliser sector did remain in the limelight not only for the result announcement but also on news that Fauji Fertiliser Company has got conditional approval from the Competition Commission for potential acquisition of Agritech.
The cement sector also found some interest on news that retail cement prices have increased.
Outlook: market to rise
The central bank’s decision to leave its key policy rate unchanged will be a positive for the market in the early part of next week while the result season will continue to influence stock-specific moves.
In addition, the market should keenly watch the progress on the ongoing negotiations between political parties which have formed a joint committee to devise a strategy to tackle the current economic crisis. The parties are also expected to meet the International Monetary Fund (IMF) team which could lead to some tangible progress on stalled reforms.
Monday, January 24
The stock market shed another 61 points as investors continued profit-taking after the recent bull-run which lasted almost three months. The Karachi Stock Exchange (KSE) benchmark 100-share index ended 0.49 per cent lower.
Tuesday, January 25
The stock market ended the day 85 points higher with major oil and fertiliser stocks leading the gains. The Karachi Stock Exchange benchmark 100-share index ended 0.69 per cent higher.
Wednesday, January 26
The stock market surged and flirted with the 12,500-point mark for the entire session before being pulled down by profit-taking in the last hour, dealers said. The Karachi Stock Exchange benchmark 100-share index ended 0.22 per cent or 27.59 points higher.
Thursday, January 27
Stocks closed flat in a lacklustre session amid thin trade as investors preferred to stay on the sidelines ahead of the announcement of monetary policy. The Karachi Stock Exchange benchmark 100-share index ended 0.05 per cent or 6.34 points lower.
Friday, January 28
Sentiments at the local bourse remained dull for another day as investors awaited the monetary policy announcement on Saturday. The Karachi Stock Exchange benchmark 100-share index ended 0.04 per cent or 4.44 points lower.
Published in The Express Tribune, January 30th, 2011.
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