Market watch: Bourse breaches the 19,000-point barrier

Expectations of timely elections and lower inflation data encourage positivity.

KARACHI: The country’s largest bourse managed to breach the landmark 19,000 points barrier after slowly creeping up and hovering near the all-time high point for the past few sessions. Volumes clocked in low as investors remain wary of taking new positions ahead of the general elections due in less than ten days.

The Karachi Stock Exchange’s (KSE) benchmark 100-share index climbed 0.27% or 52.11 points to end at the 19,034.53 point level. Trade volumes shrunk to 147 million shares compared with Tuesday’s tally of 195 million shares. The market was closed on Wednesday (May 1) because of Labour Day.

“Penny stocks dominated volumes today as participants continue to find value in select small-cap companies,” reported Muhammad Rawjani, analyst at Elixir Securities.

Army chief’s assurance of timely elections, unabated foreign buying – net foreign investment inflow was recorded at $28 million in April – and falling inflation boosted confidence and helped the bourse to sustain the 19,000-level, Rawjani added.  Pakistan Petroleum and Fauji Fertilizer Company played a major role in driving the bourse upwards.

Shares of 396 companies were traded on Thursday. At the end of the day 212 stocks closed higher, 139 declined while 45 remained unchanged. The value of shares traded during the day was Rs4.18 billion.

Samar Iqbal of Topline Securities reported that Fauji Fertilizer Company rallied after the results announcement, while investors remained sceptical on Engro Corporation because of gas supply issues.

The banking sector also continued to rally led by Soneri Bank – which is a smaller player in the industry – considered by many to be a prime acquisition target for larger banks.

Consumer and related companies also remained in the limelight as investors in the sector look for alternative players to invest in keeping in mind under progress Unilever Pakistan’s delisting from all stock exchanges of the country, said JS Global Capital analyst Ovais Ahsan.

Fauji Cement was the volume leader with 25.94 million shares gaining Rs0.24 to finish at Rs9.10 after the company announced its highest profit in over a decade on Tuesday. It was followed by TRG Pakistan with 19.59 million shares falling Rs0.64 to close at Rs10.18 and Pakistan Telecommunication Company with 7.66 million shares shedding Rs0.46 to close at Rs17.46.

Foreign institutional investors were net buyers of Rs108.93 million, according to data maintained by the National Clearing Company of Pakistan.

Published in The Express Tribune, May 3^rd, 2013.

Like Business on Facebook to stay informed and join in the conversation.