Heavy profit-taking was observed in the Karachi share market on the back of the reports regarding completion of forensic investigations of March 2005 crisis and its upcoming presentation before the National Assembly panel.
After the superb recovery of 301 points on Friday, the KSE-100 index once again tumbled by 234 points to close at the 11012-point level. The start of the market was positive with the KSE-100 Index marking 11298 points intra-day high. However, bears gradually tightened their grip to mark 11009 points intra-day low. Investors' sentiments were dreary on reports regarding completion of forensic investigations of March 2005 crisis and its upcoming presentation before the National Assembly standing committee on finance.
Ahsan Mehanti of Shahzad Chamdia Securities said that over-all sentiments at the market remained negative, which remained under pressure through out the day. He said that leveraging was high in the market because of the over-buying on the last trading session.
NBP remained the main contributor in the decline, as the deal with the Bank Al-Jazeera could not be finalised. Besides, NBP could not encourage the investors' sentiments despite reasonable earning of Rs 21 for three-quarters, which however, was under the expectations, as Rs 50 was predicted. The bank's expansion plans are seen to be in doldrums as NBP and Bank Al-Jazeera could not reach an agreement.
Hasnain Asghar Ali of Aziz Fida Hussein said that banking stocks faced heavy battering as the exchange was banging with the unconfirmed report that the prospective buyers of Al-Jazeera's stake held by NBP have given a very low bid and the deal is off, immense selling in index heavyweights therefore never allowed the market to cherish the concessions given last week. NBP possesses 5.83 percent holdings in Al-Jazeera.
However, it was known that the CFS cap was kept on Rs 26 billion and was not expanded to Rs 55 billion, as was announced. Besides the in-house financing was also not there. An analyst at Live Securities said that volumes in the ready market also remained thin at 176 million shares as against 287 million previously. Heavy battering was witnessed in all sectors of the market with notable banking, oil exploration and cement scrips closing in the red.
Bank Alfalah was the volume leader, depicting 0.8 percent decline to close at Rs 52.10. Moreover, Bank Alfalah, NBP and BoP cumulatively contributed approximately 32 percent of the total ready market volumes today. Selling pressure was evident in NBP as the scrip posted 4.8 percent decline to close at Rs 274.15 while BoP and MCB closed 1.6 percent and 3.9 percent lower from their opening levels respectively. On the other hand, PICIC Bank and Prime Bank closed in the green at Rs 37.10 and Rs 54.60 respectively on the back of rumours of their acquisition and mergers. Barring Dewan Hattar Cement, entire cement sector closed in the negative zone.
Intra-day profit taking was also witnessed in OGDCL, PPL and POL as these scrips closed 3.5 percent, 2.8 percent and 1.9 percent lower from their day's highs respectively. Out of 326 scrips traded today, bears dominated in the broader market as 191 scrips declined, 104 advanced while the value of 31 remained intact.