KARACHI – David Cameron’s visit to Pakistan, accompanied by his announcement to pledge 650 million pounds for education and to increase bilateral trade to 2.5 billion pounds by 2015 had a positive impact on investors’ sentiments. After few consecutive days of bearish activity, the KSE-100 index closed up by 32 points at 11,933 levels.
However, some correction was observed in the later half of the day as majority of the scrips underwent profit taking. While equity gains for the overall banking sector remained low, UBL stood as the best performer with a turnover of 1.6 million shares, on expectations of a strong first quarter result. Market leaders, for today, were BAFL and LOTPTA, with volumes of 7.9 million and 5.2 million respectively.
Yesterday’s closing level is considered as a floor for today’s market as index was unable to make a low than the market open. Majority of the top tier stocks including banks, oil companies, fertilisers and electricity generation were unable to impress investors with their performance. FFC and Luck performed better, while rest of the stocks posted minor gain or loss. The current range bound behavior, just before the quarterly result season, may hamper the sentiment.
The bull-run did invite renewed buying interest in various frontline stocks, secretary level talks with India over trade and commerce in the week of running month, certainly energised the leading stocks of the sector that has been otherwise under pressure due to rising input cost and decline in local and export growth. Nevertheless, overall strength that did fail to invite the potential volume, benchmark was, however, in the position of flirting with the psychological 12,000.
Rising trend in international oil prices, although a threat for the fragile economy, did invite renewed buying by the market men in the beneficiary stocks, mainly the Oil and Gas exploration and refinery sector stocks. However, stocks that have faced a rundown on the high earned reserves, mainly from the government sector, failed to join the momentum, while various high priced stocks joining the momentum faced sell-off on strength – thus minimising the gains by the day-end.
A market analyst Hasnain Asghar Ali said that tougher economic and financial conditions, likely spike in inflation and benchmark interest rates and further slow down in economy on macro and below potential turnover on micro recommending caution, while large cap stocks from the resilient sectors can be looked for trading and placements.
