Market watch: Bourse declines 25 points, averts major slide

Analysts expected the market to plummet following the budget.

KARACHI:

The first stock market session after the budget recorded selling as the announcement had nothing for the capital market.

The Karachi Stock Exchange’s (KSE) benchmark 100-share index declined 0.2 per cent or 25 points to end at 12,211.65 points on Monday.

The decline was much less than initial expectations as analysts had expected the market to fall at least 100 points.

The improvement was led primarily by cement stocks on the back of a reduction in federal excise duty and wavier of special excise duty which kept interest intact in the sector, said JS Global Capital analyst Ahmed Rauf. Volatility dominated the bourse as a neutral budget kept investors guessing, added Rauf.

Volumes rose 47 per cent to stand at 96 million shares against 65 million shares traded on Friday.

Pakistan Oilfields increased by 1.6 per cent following announcement of a major discovery in the Domail field. The discovery is expected to increase the oil and gas explorer’s profits.

Banks also attracted investor interest as pre-budget rumours of an increase in corporate tax did not materialise, analysts said.

Shares of 349 companies were traded on the first trading session of the week. At the end of the day, 76 stocks closed higher, 173 declined and 100 remained unchanged. The value of shares traded during the day was Rs4.5 billion.

Fauji Cement’s right shares were the volume leader with 15.47 million shares traded, declining Rs0.06 to finish at Rs0.07. They were followed by DG Khan Cement with 13.56 million shares, gaining Rs0.15 to close at Rs24.82 and Fatima Fertiliser Company with 5.99 million shares, increasing Rs0.04 to close at Rs13.59.

Published in The Express Tribune, June 7^th, 2011.