Market watch: Stock market off to a dull start

Benchmark KSE-100 index falls 158 points.

KARACHI: The index traded lackluster, beginning the week on a dull note since a lack of major news or earnings announcement kept the excitement low.

The Karachi Stock Exchange’s (KSE) benchmark 100-share index fell 0.55% or 158.46 points to end at 28,691.62.

According to JS Global Analyst Fahad Ali, the KSE-100 continued its correction to close in the red.

“Investor activity remained lacklustre as compared to the previous trading sessions with major interest witnessed in Maple Leaf Cement Factory (MLCF),” said Ali.



“Oil and Gas Development Company (OGDC) experienced a decline after its result which was not as per investor expectations. Pakistan State Oil (PSO) remained volatile as well in the run-up to its result announcement.

“We recommend investors to wait for dips and accumulate fundamentally strong banks and cements,” concluded Ali.

Meanwhile, an Elixir Securities’ report said that Pakistan equities traded lacklustre due to no major news and earnings announcements.

Participants that hoped PSO (PSO PA -2%) earnings would bring some respite were disappointed as earnings will now be announced tomorrow pre-open, the report added.

“Cements saw pressure inspite of morning news of marginal retail price increase as DG Khan Cement (DGKC PA -1.3%) announced an emergent meeting for 30th April to ‘consider investment opportunity’; investors are speculating on expansion plan or acquisition of Lafarge Pakistan (LPCL PA -1.7%).

“Power companies were in the limelight on anticipation of strong earnings with Hub Power (HUBC PA +5%), Lalpir Power (LPL PA +5.5%) and Pakgen Power (PKGP PA +5.4%) closing at their respective upper price limits,” the report said.



“Meanwhile, Engro Corp (ENGRO PA) was down on news of conversion of its foreign denominated debt to ordinary shares which would likely be earnings dilutive.

Analyst Naveen Yaseen of Elixir securities commented that investors to likely stay on the sidelines with PSO earnings announcement to set direction for the broader market in absence of immediate triggers.

“We see foreign flows to guide local perception and advise staying long in defensive plays such as Nishat Chunian Power Limited and Fatima Fertilizer,” concluded Yaseen.

Trade volumes fell to 181.4 million shares compared with Friday’s tally of 198 million shares.

Shares of 343 companies were traded on Monday. At the end of the day, 113 stocks closed higher, 216 declined while 14 remained unchanged. The value of shares traded during the day was Rs5.9 billion.

Jahangir Siddiqui Bank Limited was the volume leader with 5.6 million shares, gaining Rs0.30 to finish at Rs5.85. It was followed by K-Electric Limited with 3.2 million shares, declining Rs0.11 to close at Rs6.60 and The Resource Group (TRG) Pakistan Limited with 3 million shares, declining Rs0.56 to close at Rs13.43.

Foreign institutional investors were net buyers of Rs27 million during the trade session, according to data maintained by the National Clearing Company of Pakistan Limited.

Published in The Express Tribune, April 29^th, 2014.

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