Stock market Resumes upward drive
There were, however, no signs of year-end or portfolio adjustment support even on the high profile counters, which, some analysts said, could make its debut after the post-Eid holidays.
They said lifting of emergency on Dec 15 could lure some of the foreign investors back to the arena and the last week of the fading year may witness a buying euphoria followed by price flare-up.
Trading on the Karachi share market resumed on a bullish note despite profit-taking at inflated levels. However, the leading shares on the oil and banking counters managed to finish with an extended gain. Its junior partner added only 30.59 points to the previous total at 17,415 and so did the market capital at Rs4, 486 billion up by Rs24bn.
After having touched week’s high in early trading at 14,632.64, the KSE 100-share index later finished with a clipped gain of 82.63 points at 14,556.53.
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Among the leading base shares, which gave a fresh boost to the index, were OGDC, Pakistan Petroleum, National Bank, MCB, Arif Habib Securities, Engro Chemicals and some others.
Barring MCB which showed smart rise on the GDR-linked buying, other leading banks shares remained under pressure on reports that capital gain tax at the rate of 10 per cent would be imposed on banking shares.
Some leading banks also cut to size their share portfolios on other counters, some of which ended with trimmed gains amid slow business.
All eyes now seem focused on the lifting of emergency, which analysts believe, would lure foreign investment. This will be followed by the out come of the general elections and formation of government at the centre.
A fresh price flare-up in the world oil prices evoked a good buying interest in oil shares and indications are that it would be carried through the next week prior to the closure of the market for Eid holidays.
The long Eid holidays could take a modest toll of the current bullish tempo but indications are that the market is capable of maintaining its current run-up on the strength of corporate news and the talk of higher payouts, floor brokers said.
However, they ruled out the possibility of any big shake-up at this stage as investors have taken long positions at the lower levels on most of the blue chips counters which have the potential of handsome capital gains.
Although last week’s buying euphoria showed signs of a slow down on technical grounds, the underlying sentiment signals that the current run-up was not yet over done, analyst Ahsan Mehanti believes.
“The worries over the election results are there but the perception that it is being held as scheduled, has reinforced the investors’ confidence that the sailing will be smooth”, he added.
Another leading analyst Ashraf Zakaria said the market was expected to keep its current stance before Eid holidays despite the fact that some of the weak holders may indulge in profit-selling at higher levels.
“The perception that the leading political parties — the Pakistan People’s Party, and the Pakistan Muslim League (Nawaz) — have announced to participate in the elections could lend the needed credibility to the entire exercise”, he added.
Analyst Hasnain Asghar Ali said that all hopes of investors were focused on election results, and continuation of the current financial and economic policies, adding the presence of foreign buying has given credence to the fact that the post-election scenario could be normal for the capital markets”.
That is perhaps why the market has maintained its upward drive on active follow-up support on the blue chips counters.
Forward counter: Speculative issues on the forward counter, on the other hand, remained under pressure on profit-selling and fell under the lead of MCB, National Bank and some others. But some of the leading cement shares came in for fresh support and rose modestly higher and so did other blue chips on other counters.
—Muhammad Aslam