according to Jawad Aboobakar of Elixir Securities, Pakistan equities continued to lose momentum, with the index closing red on low turnover that was last seen over six months back, despite positive news flow from Pak-IMF meetings. PHOTO: AFP/FILE
The index closed in the red despite the International Monetary Fund (IMF) clearing the next installment of $550 million.
The Karachi Stock Exchange’s (KSE) benchmark 100-share index fell 0.53% or 150 points to end at 28,343.88.
According to JS Global Analyst Ovais Ahsan, the market opened the week on a jittery note as participants took cue from the IMF’s comment coming out of the recently-concluded review meeting urging the government to keep a check on rising inflation.
“Market consensus expectation changed from a 50bps cut in the upcoming monetary policy to a status quo stance as inflation jumped to 9.18% in April from 8.53% in May,” said Ahsan.
“Index heavy weights Oil Gas Development Company (-0.9%), Pakistan Petroleum Limited (-1.2%) and United Bank Limited (-1.3%) were the major decliners for the day.
“Engro Fertilizer (-4.1%) continued its southwards journey as specie dividend received by Engro Corporation holders in the form of EFERT shares continued to be sold off,” said Ahsan, adding that dividend plays remained in the limelight due to high volatility as defensive stocks like Fauji Fertilizer Company (+0.2%) bucked the trend.
“Bank AL Habib (+1%) with a decent exposure to Pakistan Investment Bond holdings and investment to deposit ratio of 70% gained as investors bet on re-pricing gains in case of decline in interest rates going forward,” concluded Ahsan.
Meanwhile, according to Jawad Aboobakar of Elixir Securities, Pakistan equities continued to lose momentum, with the index closing red on low turnover that was last seen over six months back, despite positive news flow from Pak-IMF meetings.
“Institutions, particularly locals, were in no rush ahead of this week’s policy announcement by the State Bank of Pakistan (SBP) and ignored news of the IMF clearing next installment worth $550 million,” said Aboobakar.
“Capital Gains Tax that is to see an increase from next fiscal year is gaining attention with exchange reportedly chasing stakeholders for another extension on freeze in rates.
“Most volumes were in third-tier small cap names with blocks off market in National Foods (NATF PA +5%) and Bank AL Habib Limited worth mentioning,” said Aboobakar.
“With participants in snooze mode, surprise from foreign flow may bring some excitement while we see volumes to continue to stay on similar course till MPS,” concluded Aboobakar.
Trade volumes fell to a paltry 88 million shares compared with Friday’s tally of 119 million.
Shares of 353 companies were traded on the first trading session of the week. At the end of the day, 104 stocks closed higher, 227 declined while 22 remained unchanged. The value of shares traded during the day was Rs3.9 billion.
Jahangir Siddiqui Bank Limited was the volume leader with 9.3 million shares, losing Rs0.19 to finish at Rs6.14. It was followed by Bank of Punjab with 5.9 million shares, losing Rs0.29 to close at Rs9.95 and Jahangir Siddiqui and Company Limited with 4.6 million shares, declining Rs0.41 to close at Rs11.70.
Foreign institutional investors were net buyers of Rs892 million during the trade session, according to data maintained by the National Clearing Company of Pakistan Limited.
Published in The Express Tribune, May 13th, 2014.
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