The share prices moved in a thin band as the investors were reluctant to execute long-term deals because of the indecision of the management of the Karachi Stock Exchange about the appointment of the KSE chairman.
On the back of excellent performance by top volume leaders - Bank of Punjab, Nishat Mills and OGDCL - the KSE-100 index managed to close in the positive zone and gained 31 points to close at the 9497 point level.
The selling pressure was seen in PTCL, which lost value by 45 paisa to close at Rs 64.90. OGDCL was the star performer of the day and gained Re 1.00 or 0.9 percent. PPL closed Rs 1.60 higher to Rs 210.10. However, POL and PSO lost value by 35 paisa and 80 paisa respectively. The cement sector was in pressure on Thursday with most of the scrips closing in the negative zone.
DG Khan Cement, Lucky Cement, Maple Leaf Cement decreased 0.3 percent, 0.4 percent and 0.5 percent to close at Rs 106.20, Rs 81.00 and Rs 39.65, respectively. However, Fauji Cement gained 15 paisa. Bank of Punjab, NIB and Union Bank depicted Rs 1.65, 60 paisa and Rs 1.30 increments to Rs 102.15, Rs 33.30 and Rs 68.30, respectively. On the other hand, National Bank of Pakistan along with Bank Alfalah closed negatively by losing 75 paisa and 30 paisa to close at Rs 197.75 and Rs 71.70, respectively.
The trading volumes were at 285 million shares, 21 percent lower than Wednesday last. Friday is the last day for trading in the December futures contracts. It seems the market has significantly consolidated around the 9500 point level for a major re-rating in the coming week.
The market volume shrank as the investors were anxiously waiting for the outcome of the meeting of board of directors and an informal meeting called by the members to decide the fate of appointment of chairman for the new year. The market was rife with rumour that there is a possibility of tussle between members and the stock market regulator, while few were of the opinion that like past some via media would be evolved to resolve this issue.
The future course of the market depends upon the decision to be taken in the extraordinary general meeting to be held on Friday evening. A number of proposals have been tabled which is likely to resolve the issue with the stock market regulator.
Ali Sibtan, research analyst from Elixir Securities, said that volumes are beginning to get thin with each passing day as no evident direction emerges. In truth, an year end kind of justifies the market behaviour. However, status quo cannot go on for long.
In our view, a breakdown before a movement up would have been better yet as 2006 comes into focus & results season draws closer. So even if this bores the investors to death...do keep realising those gains. Banks gained further strength with Bank of Punjab (volume leader) and Union Bank leading the sector. Fertilisers performed, OGDC kept oils from being marginalized and Lucky finally closed down. Top picks - Union Bank, Askari Bank, United Bank, POL, Nishat Mills, ICI, Pak Suzuki, Indus Motors, and Lucky.
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