Selling in Pakistan Telecommunication on rumours that profit numbers would be lower created panic among investors, and the KSE index suffered widespread selling in the scrip, resulting in heavy causalities on Tuesday. The KSE-100 declined by 77.77 points, or 1.42 percent, to 5390.35 against 5468.12 of Monday. The volume rose to 231 million shares, against 225 million shares.
Umair Dawood from Akbarally Cassim said that the market opened in positive territory. However, towards midday selling pressure erupted. PTCL led the bearish spell as it closed at its lower limit.
Market punters were expecting an EPS of Rs 1.5 for the first quarter, which seems unattainable now. Askari Bank was strong. However, selling pressure soon started as punters moved on to book their profits.
A new trend was seen in the market where investors, punters and retailers decided to offload their scrips before announcement of results.
The badla decreased by 840 million rupees. Badla in OGDC came down significantly by 6 percent. PTCL badla increased despite the share lost nearly Rs 2 in ready market, which indicated that on technical levels this share is still weak.
"Therefore, we recommend caution. Badla in NBP has come down by nearly 2.5 million shares in the past few days, which reflects that the share looks good in the days to come."
Hasnain Asghar from Aziz Fidahusein said that healthy corporate results allowed the bulls to charge in and OGDC and fertiliser led the rally.
The delay in announcement of Askari Bank invited rumour which led to adjustment in the stock and the share started losing ground which had a chain reaction and the index underwent a technical adjustment.
Technically, constant inability of the index to invite buyers on strength, thereby finding strong resistance around 5503-5510, and the view that positive development on fundamentals is required for the index to breach and consolidate above 5500 created unrest among the punters leading to an adjustment.
A leading trader from Elixir said that the market took a major beating and closed down by 1.43 percent. Everyone thought that Askari Bank would continue its forward movement ahead of its result announcement but it closed 3.24 percent lower after making an high of 91.20 rupees.
Similarly, there were market rumours that PTCL would announce an EPS in excess of Rs 1.60 for the first quarter of FY05, coupled with cash dividend, but it gave an excellent exit to the big players as the stock went crashing down 5 percent. Contrary to expectations, the trader expected PTCL to announce an EPS of 1.40 with zero payout.
PTCL moved down to Rs 38.80 from Rs 40.55 on business of 46.569 million shares; Fauji Fertiliser Bin Qasim rose 55 paisa to Rs 20.90 on turnover of 44.214 million shares; OGDC fell 65 paisa to Rs 66.55 on trading of 32.780 million shares; Askari Bank closed at Rs 87.25, ie lower by Rs 3 on a volume of 19.858 million shares; and National Bank of Pakistan lost 60 paisa to Rs 70.60 on deals of 8.629 million shares.
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