Market watch: Bourse reaches highest level since June 2008

KSE’s benchmark 100-share index crosses 13,000 points barrier.

KARACHI: The stock market is climbing at its own pace but is now within touching distance of levels last seen before the 2008 financial crisis. On Friday, across the board rally helped the benchmark index cross the key 13,000-point barrier for the first time since June 2008.

The Karachi Stock Exchange’s (KSE) benchmark 100-share index surged 1.14 per cent or 147.59 points to end at the 13,088.97 point level.

Bulls channelled momentum in the oil, bank and cement sector after local institutions joined the party and grabbed shares amid rumours of foreign buying, said Elixir Securities equity dealer Sibtain Mustafa.

Data released after the trading session turned the rumours into reality as foreign institutional investors were net buyers of Rs198 million worth of shares, according to data maintained by the National Clearing Company of Pakistan Limited.

National Bank of Pakistan surged to its daily upper limit of 5% and played its due contribution as rumours over higher stock dividend and cash payout in the upcoming earnings announcement helped channel speculative money in the stock.

Bank Alfalah also added to the good cheer with its 2011 earnings along which were wrapped with a whopping cash dividend of Rs1.75 per share and beat market expectations. The bank’s scrip jumped to its daily limit of Re1 to close at Rs14.53.

The cement sector continued to dominate the index after almost all major cement stocks closing at their daily upper limits of the day as higher prices and uptick in sales due to commencement of construction season continue to build confidence on their earnings outlook, added Mustafa.

Fatima Fertilizer and Pakistan International Container Terminal also hit their respective upper circuit breakers backed by active
buying interest. Volumes remained strong by gaining 39% to 253 million shares were traded during the day with generally broad based buying interest both by locals and foreigners.

Furthermore, Pakistan Oilfields gained 1.78% as higher international oil prices bodes well for the company’s future revenue.

Overall, the market is expected to be guided by oil stocks as investors remain optimistic, although given the recent sharp rise a downfall correction cannot be ruled out, said Mustafa

Fauji Cement was the volume leader with 44.6 million shares gaining Rs0.56 to finish at Rs5.03. It was followed by Faima Fertilizer Company with 19.3 million shares gaining Rs1.21 to close at Rs25.45 and Jahangir Siddiqui and Company with 14.45 million shares firming Rs0.19 to close at Rs9.37.

Published in The Express Tribune, March 3^rd, 2012.