Market watch: Bulls dominate session; telecom sector on a roll

Benchmark KSE-100 index climbs 121 points.

KARACHI: Activity at the local bourse was dominated by the bulls yet again, closing at another record high with a ten-month high in volumes. Investors accumulated blue-chip stocks like fertilisers, banking and energy sectors, mainly on rumours of foreign interest.

The telecom sector remained in the limelight where Worldcall, Wateen and Telecard contributed 24% to the volumes. Consequently, the stock market broke through the technical levels to close above the 17,400-mark.

The Karachi Stock Exchange’s (KSE) benchmark 100-share index climbed 0.7% or 120.45 points to end at 17,408.52 point level. Trade volumes rose to 336 million shares compared with Monday’s tally of 252 million shares. The market was closed on Tuesday, February 6, as the country observed Kashmir day.

Shares of 369 companies were traded on Wednesday. At the end of the day 202 stocks closed higher, 129 declined while 38 remained unchanged. The value of shares traded during the day was Rs7.46 billion.

“Aggressive institutional buying in hope that the caretaker government will take charge soon supported the climb,” reported Samar Iqbal, equity dealer at Topline Securities.

The telecom sector will announce their performance for the year 2012 next week. Investors anticipate positive earnings announcements due to the fact that the fixed line telecom providers will get a boost to their bottom-line as international call rates are still inflated despite the international telecom gateway being declared anti-competitive.

“Rumours of interest in blue chips by foreign investors kept the market energetic, pushing it to an all-time high” said Fahad Ali, analyst at JS Global Capital.

Worldcall Telecom was the volume leader with 53.42 million shares gaining Rs0.63 to finish at Rs3.49. It was followed by TRG Pakistan with 33.86 million shares gaining Re1 to close at Rs8.28 and Wateen Telecom with 24.51 million shares climbing Rs0.35 to close at Rs0.35. Four of the top five stocks on the volume leader board belonged to the telecom sector.

Foreign institutional investors were net buyers of Rs384.44 million ($3.9 million), according to data maintained by the National Clearing Company of Pakistan Limited.

Analysts say that the bourse has the potential for further upside where investors will target the energy and cement sectors.

Published in The Express Tribune, February 7^th, 2013.

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