Market watch: Market continues upward trend

Benchmark KSE-100 index rises 54 points.

KARACHI: The market continued its upward trend to close above all-time high yet again, however the driving forces behind the climb were not the usual oil and financial sectors; but mid-tier stocks like cement producers, textile and telecom supported by the high-end fertiliser stocks.

The Karachi Stock Exchange’s (KSE) benchmark 100-share index rose 0.33% or 53.64 points to end at 16,251.38 point level.

“Investors remained active in mid-tier stocks, with support from fertiliser sector, Lotte Pakistan and Engro Corporation,” said Samar Iqbal, equity dealer at Topline Securities. Trade volumes remained healthy and jumped to 246 million shares compared with Friday’s tally of 165 million shares.

The fertiliser sector attracted buying after a jointly tailoring a new urea pricing formula with the Ministry of Industries, which recommends slashing Rs68 per million British thermal units in gas development surcharge, 4.7% reduction in sales tax and provision of 200 million cubic feet per day of gas supply to urea plants, thus cutting urea price by Rs150 per bag.

The news also drove Engro Corporation to its upper-limit jumping Rs4.50 to Rs94.60, in anticipation of uninterrupted gas supply to its Enven plant on the Sui Northern Gas Pipelines network.

The telecom sector, after being depressed since the stay order by the Lahore High Court, recovered on expectations of a settlement of the case among related parties, according to Shakir Padela, analyst at JS Global Capital.

While Lotte Pakistan also jumped on the bandwagon after Asian PTA producers proposed to link PTA price with Paraxyelene to improve margins.

The value of shares traded during the day was Rs4.96 billion.

Maple Leaf Cement was the volume leader with 31.27 million shares gaining Rs0.98 to finish at Rs13.02. It was followed by Azgard Nine with 26.51 million shares gaining Rs0.70 to close at Rs8.73 and Fauji Cement with 18.15 million shares climbing Rs0.13 to close at Rs6.87.

Foreign institutional investors were net sellers of Rs15.12 million, according to data maintained by the National Clearing Company of Pakistan Limited.

Published in The Express Tribune, November 20^th, 2012.