Stocks remain dull as investors stay away

Stocks were lacklustre on Thursday with the index ending marginally lower as most investors chose to remain on the sidelines with focus on next week’s monetary policy statement.

The Karachi Stock Exchange’s (KSE) benchmark 100-share index fell 0.05 per cent, or 5.17 points, to end at 10,228.86 points.

The rejection of all bids in the Pakistan Investment Bond (PIB) auction on Wednesday provided an early positive impetus to the market but lack of any concrete positive triggers could not help sustain the positive momentum, said Ahmed Rauf, an analyst at JS Global Capital.

The market witnessed a volatile session with low volumes of 60 million shares compared with 118.68 million shares traded on Wednesday.

Shares of 404 companies were traded on Thursday. At the end of the day, 201 stocks closed higher, 180 declined and 23 remained unchanged in value. Trade was dominated by second and third-tier stocks. The value of shares traded during the day was Rs2.1 billion.

Local sentiments are expected to remain upbeat as possibility of a policy rate hike in the upcoming monetary policy statement has been subdued after the State Bank of Pakistan cancelled the bids in the PIB auction, said Mohammad Rameez, an analyst at Elixir Securities.

Accumulation will occur at the current levels as triggers such as introduction of an efficient margin trading product and corporate result season looms ahead, added Rameez.

Some profit-taking was witnessed from local investors as oil and fertiliser sectors closed in the red. Cement stocks also came under pressure on news regarding 0.89 per cent decrease in exports on yearly basis and the Ministry of Finance not releasing 35 per cent inland freight subsidy for cement exporters.

Among the scrips, JS and Company Limited continued its bull-run after Clinton’s announcement about investment of $50 million in JS Private Equity. It ended the day as the volume leader with 12.7 million shares traded.

Lotte Pakistan came second with 3.79 million shares losing Rs0.03 to end at Rs8.35. Nishat Mills came third with 3.17 million shares gaining Rs1.10 to close at Rs50.67.

Published in The Express Tribune, July 23^rd, 2010.