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WEEKLY
SECTIONS |
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| KSE up 157 points as institutions,retailers enter oversold market |
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Wednesday, January 28, 2009
By our correspondent
KARACHI: The local equity market entered the green zone after more than two weeks. Bulls took over the steering from bears that were running the show since January 12 pulling down the market by 21.6 per cent in just two weeks. The market on Tuesday gained 3.26 per cent.
The persistent presence of the NIT State Enterprise Fund on the buying front added to the positive sentiments of market participants. Local institutions and retail investors took positions in oversold market.
Despite the fact that foreign investors continued selling and withdrawn $15.5 million from the market the support from local institutions and investors helped the market to gain its lost position.
The KSE 100-share Index opened in the red zone with a loss of 18.59 points and closed 157.21 points up at 4,972.55.
The KSE 30-share Index gained 212.64 points to close at 4,640.74 points. KMI-30 index closed at 6,587.73 up 265.50 points. The All Shares Index closed at 3,755.26 with a gain of 108.16 points.
Market capitalization stood at Rs1.59 trillion as compared to Rs1.54trillion a day earlier.
Sajid Bhanji VP Capital Market Arif Habib Ltd said that NIT buying in government scrips along with the support of the local institutions and investors’ interest helped the market to recover.
The positive statement from the Advisor to Prime Minister on Finance Shaukat Tarin that in the coming monetary policy no interest rate hike is expected paved the way for the bullish market.
Energy, banking and fertilizer sector remained in the limelight and heavy buying was witnessed in these sectors.
Low volume adjustment took the bears by surprise, the reflection of 4,700 levels alarmed the liquid players from the local arena, the extremely discounted banking stocks led the show and soon the main board banking stocks hit the upper levels.
Although the results in the coming year will reflect the tough time sector is going through, the rates have discounted to the worse, results of the main board stocks of the sector can therefore witness recovery, it is estimated that the rates can recover up to 15 percent from their lows.
The sentiment soon spilled to the other sectors and in no time index comfortably settled with gains in three digits. Although turnover was low, ability of the index to maintain positive stance allowed even battered stocks to not only enter green zone but hit the upper locks by midday.
Although prominent elements stayed sellers in the market, recovering local currency supported the buyers; extreme discounts forced the nervous sellers from within to take a chance, as it seems that it has been generally accepted that region of 4500-4700 is a strong support region.
Despite the fact that index has started crawling back in the positive region, absence of aggressive and big quantity buyers, effective leverage tools, the local bourses will stay highly volatile.
The margin hunters are not likely to wait for too long, as the nervousness related to upcoming monetary policy and federal budget will keep the players at the edge of their seats. Therefore, to accumulate main board stocks on dips will be prudent, while technical levels can provide the lead for off-loading if the turnover stays on lower side said Hasnain Asghar Ali analyst at Aziz Fidahusein.
Trading activity was better as compared to the last trading session as the ready market volume stood at 194.22 million shares as compared to last trading session 125.65 million shares.
After a long gap some trading was also witnessed in future market and its volume stood at 3,000 shares as compared to nil shares in the last session. 178 companies advanced, 70 declined and 9 remained unchanged.
Highest volumes were witnessed in NIB Bank that saw 34.76 million shares traded and closed at Rs4.56 with a gain of 61 paisa followed by OGDC that gained 93 paisa to close at Rs41.9 millions shares on volume of 20.53 million shares, Jahangir Siddiqi Co was up Rs1.15 at Rs24.22 on turnover of 15.89 million shares, PTCLA bagged 78 paisa to close at Ra12.78 on 15.74 million shares, Arif Habib Sec lost 32 paisa to close at Rs18.23 million shares on trading volume of 13.41 million shares.
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ISSN 1563-9479 
