Trading activity at Karachi Stock Exchange on Friday ended on a positive note on the back of, what the analysts believed, recovering global commodities and WTI crude oil closing over $100 a barrel. The last trading day of the week saw the KSE 100-share index benchmark closing 5.17 points higher at 11,967.35 against 11,962.18 points of Thursday. “Positive close witnessed amid thin trade after recovery in global commodities and WTI crude oil close over $100,” said Ahsan Mehanti, Director Arif Habib Investments.
The day saw the index crossing the 12,000 figure to stand at the intraday high of 12,010.11 points after recovering from the intraday low of 11,941.88 points. Despite renewed foreign interest in the blue chip scrips and institutional support, the volumes remained thin on the day that witnessed 56.643 million shares trading at the ready-counter against 64.353 million a day earlier. The market capital accounted for Rs 3.176 trillion, almost the same on Thursday.
Jahangir Siddiqui Company was the volume leader recording 10.622 million of its ordinary shares traded and clinching a 0.26-paisa per share gain. Opening and closing rates for each of the company’s shares stood, respectively, at Rs 6.87 and Rs 7.13. The future market witnessed a sluggish trend and saw a decline of 6 million shares in the total turnover that for the day stood at 28.07 million against 22.82 million on Thursday.
According to analysts, positive factors like an expected rise in local urea prices, a foreseen positive outcome of the Pak-IMF talks on economic development and federal budget, renewed foreign interest in blue chip scrips and institutional support played a catalyst role in positive close at KSE.
This was “despite security concerns in the country after suicide bombers attacked Pakistan Paramilitary academy claiming backlash for May 2 killing al Qaeda chief,” Mehanti said. Another stock observer Hasnain Asghar Ali of Aziz Fidahusein and Company said the bomb blast in Khyber Pakhtoonkhwah certainly added to the nervousness, thereby leading to a negative opening, while various high priced stocks witnessed renewed selling.
He said the Fauji group’s fertiliser stocks invited renewed interest from local and offshore counters, besides inviting the day traders for short term bets, the activity allowed the benchmark an early entry in the positive territory, volumetric support in ANL and JSCL did keep traders active and with snap rallies in various stocks, volumetric decline was in LOTPTA, mainly to prolonged stagnation led technical correction.
“Tough decision by the National Assembly that may even change the country’s fundamentals and can impact financial agreements, did caution the investors, thus disallowing any major activity at the local bourse,” the analyst said and added that “Caution was therefore quite evident.” He said ahead of federal budget and monetary policy the ability of the elected government to reach a consensus that could sustain relations with the US, yet protect sovereignty of the country, may, however, prove a short-term trigger to the local bourse. “However in the case of tough decision a short-term tremor before a concrete strategy can be witnessed, volatility may therefore stay on a higher side,” Husanian said.
