Stocks end flat as investors remain cautious

The stock market remained range-bound on Wednesday as investors stood cautious following violence in the city for the third day running.

The Karachi Stock Exchange (KSE) benchmark 100-share index ended 0.02 per cent or 1.63 points higher at 10,390.27 points.

At least 63 people have been killed in Karachi violence since Muttahida Qaumi Movement’s (MQM) provincial legislator Raza Haider was shot dead on Monday.

Bullish momentum in the early session propelled the market to the 10,480 level, however later investors preferred to book profits that pushed the market near its opening level, dealers said. The index moved in a reasonable range of 102 points.

Stocks witnessed modest volumes as confidence remains low after the recent discount rate hike followed by the unfortunate happenings in the city, said Elixir Securities analyst Sara Shahid.

Trade volumes rose to 72.55 million shares compared with Tuesday’s tally of 45.73 million shares.

“Although the discount rate hike is still playing on investors’ minds, some solid results and possibly introduction of a leverage product in the market may avert declines,” said Shahid.

Shares of 387 companies were traded on Wednesday. At the end of the day, 169 stocks closed higher, 189 declined and 29 remained unchanged. The value of shares traded during the day was Rs3.2 billion.

Cement stocks gained as investors expect the demand may go up after the monsoon season ends and construction activity picks up, said Shahid.

Lucky Cement announced that the Pezu plant was online again after some miscreants had created hurdles which halted operations at the plant for more than five days. The company’s stock price rose more than one per cent to close at Rs69.37.

Arif Habib Securities was the volume leader with 9.5 million shares, gaining Rs1.58 to end at Rs34.62. It was followed by Jahangir Siddiqui and Company with 5.2 million shares, firming Rs0.19 to close at Rs13.53 and D G Khan Cement with 4.3 million shares, gaining Rs0.31 to close at Rs27.41.

Equities are expected to move up ahead of key results including those of Pakistan State Oil (PSO), Pakistan Petroleum Limited and MCB Bank this week followed by Oil and Gas Development Company (OGDC) early next week, added Shahid.

MCB Bank is due to announce its results on Thursday while PPL and PSO are scheduled to announce their results on Friday.

Published in The Express Tribune, August 5^th, 2010.