Market watch: Index powers past the 30,000-point barrier

Benchmark KSE-100 index increases 186.52 points.

KARACHI:

Backed by heavy institutional buying, the index broke past the 30,000-point barrier, ending the week on a high despite the ongoing political uncertainty.

At close, the Karachi Stock Exchange’s (KSE) benchmark 100-share index rose 0.62% or 186.52 points to end at 30,044.89. The index had earlier crossed the 30,000-point barrier on July 18 and consolidated before starting to shed points.

Elixir Securities analyst Sibtain Mustafa said Pakistan equities managed to cross the barrier mark and closed above the resistance level. “This was mainly based on a buying spree by institutional investors with locals also getting back in action to cover the earlier sold position.



“Stocks opened on a milder note but soon gained momentum led by United Bank (UBL) +2.4% and Pakistan Petroleum (PPL) +1.7% to drive rally to touch intraday highs of 30,147.”

Mustafa added that second tiers continued to dominate flows with the auto sector closing higher on mixed bag of news about delay of Yellow Cab scheme and auto sales improving by 76% MoM.

“Pak Suzuki (PSMC) -2.5% will be the worst hit in case yellow cab scheme gets delayed or abolished,” said Mustafa.

“Thursday’s hydrocarbon discovery in a field owned 100% by Oil & Gas Dev Co (OGDC) +1.4% with EPS of Rs0.28 impact was a good enough reason for investors to take notice of this index heavy oil play that is due to see a GDR offering in coming months.

“Market has recovered almost 10% from its recent lows as political issues seem to be on the right track. However, sit-ins in the capital continue and negotiations are still under way.”

Mustafa concluded that, floods in Punjab and Northern Areas remain a concern for macros particularly on inflation and loss of crop.



JS Global analyst Ovasis Ahsan said local mutual funds, which had been sitting on high levels of cash in anticipation of a larger decline in the market due to the political impasse, were forced to come in to buy to avoid losing out on performance as the index breached the 30k level.

Trade volumes rose to 167 million shares compared to Thursday’s tally of 161 million.

Shares of 376 companies were traded on the last day of the week. Of these, 137 companies declined, 221 closed higher while 18 remained unchanged. The value of shares traded during the day stood at Rs9.2 billion.

Pak Elektron Limited was the volume leader with 11.7 million shares, losing Rs0.66 to close at Rs30.55. It was followed by K-Electric Limited with 11.0 million shares, gaining Rs0.05 to close at Rs8.47 and Fauji Cement SPOT with 8.0 million shares, gaining Rs0.01 to close at Rs19.88.

Foreign institutional investors were net buyers of Rs834 million worth of shares during the trading session, according to data compiled by the National Clearing Company of Pakistan Limited.

Published in The Express Tribune, September 13^th, 2014.

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