Buying spree in key stocks at Karachi Stock Exchange (KSE), especially in Pakistan Telecommunication Ltd (PTCL), raised the average badla investment where badla rates, after two months' period, entered double-digit column. The average badla investment began to slide from Rs 25.6 billion during September 6-10, 2004 to stop at Rs 23.3 billion during last week, registering a decline of 9 percent in three weeks' time.
However, it showed an uptrend during last week on account of prevalent positive sentiment at the stock market.
Total badla investment at KSE on Friday amounted to Rs 24.8 billion, compared to previous Friday (Sep. 24) badla investment of Rs 23.8 billion. An increase of Rs 1 billion or 4.5 percent in badla investment was caused by increase in stock prices.
Among the COT chart toppers, OGDC continued to head the list with an average COT investment of Rs 3.1 billion, posting an upsurge of 7 percent week-on-week basis. What is worthwhile to note is that PTCL badla volume and investment remained skyrocketing during the period under review.
Institutions remained active in PTCL (due to outstanding FY04 results of the company coupled with hefty cash payout of 50 percent) followed by heavy weak holding, resulting in a corresponding increase of 68.7 percent and 81.2 percent in the average COT volume and average COT investment of PTCL (price appreciation of Rs 5.25/share in PTCL is witnessed during the last seven trading sessions), said a report of Capital One Equities.
With an increase in the average COT investment and average COT volume, the badla rate was also pushed into double-digit zone to stay at 10.3 percent, up by 7 percent week-on-week basis.
Average COT rate of Union Bank stood at 16 percent, which was the highest among the top 30 COT stocks, while average COT rates of Southern Electric and BSJS Balanced fund stood at 15.7 percent and 15.2 percent respectively.
It is to be noted that Southern Electric and BSJS Balanced Fund are the first two stocks to leave the COT counter this October.
For the coming days it is believed that the market would certainly witness some correction. However; it is hoped that positive sentiment would continue to prevail in the market. As for the COT market, the rate may hover within 9 percent-11 percent mark.
A report of Investcapital Securities said that the overnight money market rates came down in the later part of last week as the central bank picked a lower amount in the T-Bills auction. If the overnight money market rates remain on the lower side, the carryover rates at KSE may ease marginally.
This is based on the assumption that the market does not witness any major rally in the coming days.