KSE up 23 points to cross 14,800 level in overbought market
Thursday, December 27, 2007
KARACHI: Buying on selective counters helped Karachi Stock Exchange benchmark KSE 100-share Index easily breach through the 14,800 points barrier successfully for the first time on Wednesday.
KSE-100 closed at 14,815 points with a modest addition of 23 points to 14,792 points previous all time high hit of last working session on December 24.On the contrary, the 30-Index shed five points and concluded at 17,666 points simultaneously.
The second and third tier stocks, mainly from banking sector, provided support to the 100-Index keeping it above the 14,800 points level by the session closed.
Market opened with aggressive buying in all categories of stocks on board and took 100-Index to 14,876 points intra-day high in the just opening minutes. It was the defining moment for the investors that whether they wanted to go ahead from here to the next astonishing destination or they wanted to stop here to minimize the risk factor, a leading analyst said.
Jobbers adopted the second strategy and stopped further accumulations at the day higher share prices. From hereon the speculators took over the market in their hands and pushed indices into the red region where most of the frontline scrips stayed till the session end.
In the middle of the session, the index fell to 14,766 points intra day low - losing 110 points from the day peak level. Blue chips close in red: Engro Chemical and Lucky Cement were the only two scrips, which managed to end in the positive column gaining Rs2.70 and 50 paisas respectively. Otherwise all the front line stocks settled in the red territory.
Pakistan Telecommunication Company closed pegged at Rs44.80 with a thin volume at 0.9 million shares. Fauji Fertilizer Bin Qasim, Oil and Gas Development Company and DG Khan Cement shed in a range of 20 paisa to 70 paisa. Pak Petroleum and Pakistan State Oil lost respectively Rs1.10 and Rs1.15. While National Bank, Pakistan Oilfields and MCB Bank share prices declined in a range of Rs2.10 to Rs3.20, it was noted.
The reason behind adjustment in leading stocks and buying in second and third tier stocks was said to be the risk factor. The leading stocks have entered into the overbought zone and buying in these scrips would be more risky. While potential offering second and third tier stocks were yet to be exploited, a broker said.
CFS rate near 10-month high: The CFS rate at present was near 10 months high level at 14.06 per cent owing to the year ending factor and some of the lenders were busy in year-closing business, he added.
And on the other hand, the available funds in CFS were fully utilized at Rs55 billion by the market players that is why the day traders were not buying the CFS eligible scrips that are incidentally the frontline stocks.
Those having hard cash in hand were buying potential offering stocks that fortunately are other than the CFS eligible scrips at present, he added. For this reason, the retail investors participation was very thin in the stock exchange and owing to high risk factor in skyrocketing market they just observed the stocks movement and remained dormant on buying part.
SCRA balance declines: So definitely, it were the only local financial institutions who were continuously inflating the new investment bubble at the local bourse, as the overseas investors retraced footsteps, which is evident with the shrinking SCRA balance these days.
According to the State Bank latest available figures of Dec 24, the SCRA balance declined to US$67.2 million to date for this fiscal year from US$109.7 million was recorded on Dec 18. The decline in SCRA account clearly showed that the foreign fund managers were getting distance from local bourses and disinvesting in government bounds.
Turnover in ready market turned higher to 308 million shares with injecting fresh funds worth of Rs9 billion in the overall market capitalisation surged to Rs4.555 trillion. It was somehow a balance market with 180 stocks advanced against 176 declined, while the value of 29 stocked closed stable with total 385 active counters on board.
Highest volumes were witnessed in TRG Pakistan at 37.697 million closing at Rs14 with a gain of Re1, followed by Allied Bank at 20.687 million closing at Rs141.25 with a gain of Rs6.55, JS Bank at 19.275 million closing at Rs23.95 with a gain of 80 paisa, NIB Bank at 17.403 million closing at Rs23.40 with a loss of 20 paisa and Bosicor Paksitan at 15.085 million closing at Rs23.10 with a loss of 15 paisa.
KSE up 23 points to cross 14,800 level in overbought market