KARACHI, April 7: Stocks failed to extend the weekend rally on Monday owing to late snap selling by some of the weak holders after reports of maltreatment of the former chief minister of Sindh during the assembly session reached the market but it was well-absorbed at the dips. The KSE 100-share index posted a fractional fall of about three points 15,470.

The underlying sentiment, however, did not show any signs that the current run-up is overdone but indicated that the market will resume its upward drive by tomorrow.

Trading resumed on a higher note as investors continued to build up long positions on banking, oil sectors and some blue chips amid market talk of strong presence of foreign buying.

The early buying euphoria was also well-reflected in the KSE 100-share index, which maintained its weekend run-up and soared well over 100 points to hit its highest level so far at 15,589.32.

The strength of leading base shares, notably MCB Bank, OGDC, Engro Chemical Pakistan, Arif Habib Securities and Bank Al-Falah contributed to the initial robust opening.

But the closing was a bit lower as it ended with a fractional fall of 2.71 points at 15,469.74 on snap technical selling by some of the leading punters.

Its junior partner on the other hand rose by 11.29 points at 18,871.15.

“The snap reaction may have been caused by some negative developments in the Sindh assembly session followed by walkout by MQM on reports of maltreatment of the former chief minister,” said Ahsan Mehanti, an analyst, adding “essentially I will call it technical correction in an apparent overbought market.”

“There was nothing wrong in the background corporate news to which the reaction could be attributed,” he said and added, “37.5 per cent cash dividend by Lakson Tobacco Company whose management has decided to close the local production facilities because of massive losses caused by Dec 27 burning of the factory as a reaction to Benazir Bhutto’s assassination shows that sharing of profits with the shareholders is a chief priority”.

A record bonus issue of 455.55 per cent by the Pakistan Reinsurance reflects that insurance sector continues to be an envy of investors despite massive claims on most of them against Dec 27 riots. Its share value surged by Rs22.70 at Rs477.35 (face value Rs10) in post-bonus announcement.

“Foreign investors are in market in a big way and may have a long-term planning and sound portfolio building though on selected counters,” said another leading analyst Faisal A Rajabali, adding “the picking up of stocks, notably in the banking oil sectors, shows that they mean business.”

Dividend season for the financial year ended March 31 is just around and indications are that corporate earnings of most of the leading companies show the payouts are expected to be on the higher side and in line with the analysts predictions, which push the market further higher in the coming weeks, he said.

The general perception is that they are now pretty sure that the new political setup is fairly strong and could deliver despite the fact they were trusted with an economy which needs massive investment, both local and foreign.

MCB Bank, Bank Al-Falah, Arif Habib Securities, OGDC, Engro Chemicals, Nishat Mills were in the forefront of the rising shares, which ended with sharp gains even at the highly inflated levels.

Leading gainers were led by Siemens Pakisan and AKD Capital, up by Rs31 and Rs30, followed by Central Insurance, IGI Insurance ahead of its board meeting, Thatta Cement, which made debut at Rs10 and rose by Rs18.95, Pakistan Refinery, Dawood Hercules, BOC Pakistan, National Foods and Shezan International, which posted gains, ranging from Rs8.10 to Rs18.95.

Pakistan Engineering and Colgate Pakistan led the list of major losers and fell by Rs18.40 and Rs15. Other prominent losers include JS & Co, PSO, Pakistan Cables, Pakistan Services, EFU Life and Lakson Tobacco, off by Rs7.40 to 13.80.

Trading volume fell from the weekend higher level to 255 million shares as losers held a comfortable lead over gainers at 172 to 144, with 37 shares holding on to the last levels.

Arif Habib Securities led the list of actives, sharply higher by Rs8.60 at Rs188.60 on 24m shares, followed by Nishat Mills up by Rs6.15 at Rs129.50 on 18m shares, D G Khan Cement, firm by Rs1.45 at Rs116.45 on 16m shares, OGDC, steady by 25 paisa at Rs137.50 on 12m shares, Engro Chemical, higher by Rs7.20 at Rs347.40 on 12m shares, Bank Al-Falah, up Rs2.30 at Rs58.75 on 10m shares, and MCB Bank, higher by Rs5.50 at Rs418 on 6m shares.

Other actives were led by Azgard Nine, up Rs3.80 at Rs80.75 on 11m shares, Pervez A Securities, higher by Rs3.80 at Rs80.20 on 9m shares, and Lucky Cement, steady by five paisa at Rs144.10 on 6m shares.

FORWARD COUNTER: D G Khan Cement led the list of actives, up Rs1.25 at Rs117.00 on 6m shares, followed by Nishat Mills, higher by Rs6.20 at Rs130.20 also on 6m shares, Engro Chemical, higher by Rs7.95 on 5m shares and Arif Habib Securities, up Rs1.25 at Rs190.10 on 4m shares.