Support from financial institutions during the last one hour of the trading session on Tuesday helped the KSE-100 index to avert major declines as sharp recovery was witnessed in D G Khan Cement, Bank of Punjab, PTCL, Hubco and Askari Commercial Bank. The KSE-100 index fell 31.02 points, or 0.61 percent, to 5087.37 as compared with 5118.39. The volume rose to 176 million shares as against 110 million shares of Monday.
Azhar Javid, research analyst from WE, said that it was the first time in approximately last one-and-a-half years that the index breached a 200 days moving average and went as low as 5033 points.
This does not augur well for the market as it is difficult to reverse the trend once the 200-day moving average is breached.
The index recovered from that point and closed at 5087 points. Tuesdays are normally under pressure as three days' badla is applied on shares traded.
"The market in general is expected to remain weak but we believe that there would be some activity in Hubco and SSGC on technical grounds."
Hasnain Asghar from Aziz Fidahusein said that the absence of sellers on dips created unrest among the short sellers as the main stocks invited institutional buying, although buying witnessed in main stocks helped recover 55 points. Technically, the index registered a closing above support of 5066-5072.
The weak advance versus decline ratio indicates a meagre dip, while the resistance may come to around 5125-5133.
Ability of the index to register opening above 5100 to invite turnover and find consolidation around 5103-5110 might allow the index to test psychological trend during the current week.
It is therefore recommended to take advantage of abnormal dips as the materialisation of CVT withdrawal rumour will give the index a desired uplift.
Cyra Patricia from Live Securities said that the market continued steadily on its downward journey, thus forcing potential investors to keep off the trading floor.
Wednesday's session could be crucial as the expected hike in the cut-off yield is likely to push down the index further. "We continue to see the index moving in the 5000 range band."
Distraught investors continued to remain behind the sidelines as the market did not discount any positive news.
Profit-taking was observed solely in PPL, POL and Attock Refinery as investors booked their capital gains. Buying at session's end in ICI, Askari and other banking scrips helped the index to recover to a certain extent.
D G Khan Cement on volume of 26 million shares remained unchanged at Rs 55.85; OGDC fell 60 paisa to Rs 61.65 on turnover of 23.5 million shares; Bank of Punjab moved up to Rs 64.40 from Rs 63.90 on trading of 11.5 million shares; Lucky Cement closed at Rs 35.50, ie lower by 25 paisa on deals of 9.3 million shares; and Hubco showed an increase of 50 paisa to Rs 31.20 on business of 9.2 million shares.
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