TRADING at the Karachi stock market remained lacklustre all through the week with the KSE-100 Index posting a minor gain of 85 points or 0.6 per cent over the previous week. The benchmark index settled at 14,761 points at the close of week’s trading on Friday.

Volumes shrank by 28 per cent to average daily turnover at 60 million shares, from 83 million shares traded on average per day, the previous week. The decline was attributed to lack of triggers as well as shortened trading time during the month of Ramazan.

Foreigner investors were net buyers of $5.96 million worth equity during the week. This represented sizeable increase over the foreign portfolio inflow at $3 million the week ago.

While the stocks were driven high on account of turnaround in Pakistan-US relations, the week before, which paved way for the swift disbursement of the $1.12 billion by US, in pending Coalition Support Funds (CSF), investors were starved of news flow that could bolster sentiments in equities during the outgoing week.

Analysts at AKD Securities said that the stocks rose during the week, ahead of  the SBP Monetary policy announcement. Yet the overall gains were curtailed by escalation in political volatility. Stocks therefore reacted to sector-specific news: The telecom sector was buffeted by NAB alleging tax evasion of Rs47 billion by five cellular operators while the fertilizer sector was affected by planned urea imports and rumors of a cut in urea and DAP prices by the Fauji twins—Fauji Fertilizer and Fauji Bin Qasim.

“The market performance during the week was somewhat surprising, considering that expectations of potential easing in the upcoming monetary policy continued to gain traction”, commented KASB Research analysts. They said that in addition to that, the market only selectively responded to a raft of blue chip companies (MCB, OGDC, PSO, Indus Motors and HBL) springing positive surprises in their results for the quarter ended June 30.

The market did not elicit much excitement to the consistently positive foreign portfolio inflows.Part of the drag was thought to be the noisy politics where following the striking down of the controversial Contempt of Court Bill the previous Friday evening, the Supreme Court issued a show cause notice to the Prime Minister and summoned him to Court on August 27.

Analyst at JS Global, Naveed Tehsin said that the investor interest at the KSE remained subdued during the week, for all eyes were focused on the week-end Monetary Policy Statement. He said that a slew of corporate results drove stock specific activity.

Among the top gainers during this week was Allied Bank, up by 5.7 per cent over the earlier week, ahead of result announcement for first half of FY2012. Shell Pakistan jumped 5.4 per cent and PSO gained 4.4 per cent following above-consensus FY12 results. Other major gainers included: KESC,, Security Papers, Bestway Cement, E.F.U. Life Assurance and Clariant Pakistan. The notable losers included Engro Polymer down by 4.6 per cent following a disappointing 1HCY12 result and Pakistan Telecom lower by 3.4 per cent on higher regulatory risk.

Other big losers included Metro Bank and GlaxoSmithKline.

Volumes leaders during the week included: KESC, which saw turnover of 29.23 million shares as the company posted a profit in full-year FY12. Jah.Sidd.Co was next with trading in 17 million shares and Maple Leaf Cement contributed 16 million shares to the aggregate weekly market turnover.

Going forward, the key driver for the KSE in the upcoming shortened week was likely to be higher-than-expected rate cut by the SBP in its Monetary Policy announced late Friday. “The KSE could see the index climb over the 15,000 mark next week”, says CEO at brokerage Topline Securities, Mohammad Sohail. While participants were likely to adjust positions ahead of the six day break, post Eid, the investor attention would remain focused on the PM’s appearance in Court and the evolving events on the political front.—Dilawar Hussain