DAILY STOCK MARKET UPDATE: 16.01.2012

Stock

Karachi Stocks Up 105.34 Points:
KARACHI, Jan 13: At the close of trading; the KSE-100 index was at 11014.46, up 105.34 points. 

January 13, 2012

TOP  5  SCRIPTS GAINERS AND LOOSERS:

Rafhan Maize	Rs 97.67	Nestle Pakistan	Rs (56.57)
Indus Dyeing	Rs 18.97	Tri-Pack Films	Rs (3.87)
Millat Tractors	Rs 12.26	Nadeem Textiles	Rs (1.65)
Attock Petroleum	Rs 7.44	Al-Noor Sugar	Rs (1.63)
Attock Refinery	Rs 5.46	Packages	Rs (1.48)

KSE 30 – Shares Index	Previous 100,60.65, Friday’s 10.176.24, plus 115.59 points
KSE 100 – Shares Index	Previous 10,909.12, Friday’s 11,014.46, plus 105.34 points
MARKET CAPITALIZATION	Previous Rs2, 840.075bn, Friday’s 2,866.557bn, plus 26.482bn
VOLUME LEADERS	JS & Co 3.271m, Fauji Fertiliser Bin Qasim 2.449m, Fatima Fertiliser 2.256m, Fauji Fertiliser 2.104m, National Bank 1.851m shares
TOTAL VOLUME	32.057m shares
TOTAL	TONE: steady, total listed 638, actives 320, inactives 318, plus 147, minus 47, unchanged 126

KSE-100 Index recovers over 100 points as bulls return

KARACHI, Jan 13: The weekend session witnessed the return of bulls on the share market at the lower levels amid active short-covering positions and halted the downward drift caused by the standoff between major organs of the state on some national issues.But leading analysts said it was a technical rebound long overdue that came after perceptions of some easing in the political heat followed by some objective thinking by the saner elements, notably the coalition partners in the government and their efforts to defuse tension.
The positive change in the market psychology was also reflected in the behaviour of the benchmark, which recovered over 100 points at 11014.46 and indicated that the market fundamentals could keep the broader market in a positive mood on the strength ofbase shares.
Some of the leading base shares, which checked fresh decline in the share values that too at the weekend session, which generally attracts profit-selling included Fauji Fertiliser, National Bank, PSO, Pakistan Oilfields and Fauji Fertiliser Bin Qasim.
`But the credit for initiating recovery largely goes to the index-heavy OGDC, which received a massive battering earli-er in the week, and put the market back on the rails on strong covering purchases at the attractively level,` most analysts believe.They said the recovery in part may be technical, but buying at the current levels, notably on the blue chip counters, appears to be a bitsafe and did not involve major financial risks.
The presence of foreign buying appears to be a remote possibility at this stage, but they could come back after some positive signals emit from the apex court about the cases under trial, they added.Among the top gainers, Rafhan Maize and Indus Dyeing were leading, up by Rs97.67 and 18.97, while prominent losers included Nestle Pakistan and Tri-Pack Films, off Rs56.57 and 3.87 respectively.
Traded volume rose to 32.057mshares from the previous 21m shares a day earlier as gainers forced a strong lead over losers at 147 to 47, with 126 shares holding onto the last levels.
The active list was topped by JS & Co, steady by 20 paisa at Rs4.27 on 3m shares followed by Fauji Fertiliser Bin Qasim, firm by 29 paisa at 43.58 also on 3m shares, Fatima Fertiliser lower by nine paisa at 22.87 on 2m shares, Fauji Fertiliser, upRs1.76 at 162.57 also on 2m shares, National Bank, higher by 48 paisa at 42.29 on 2m shares, Engro Corporation, firm by 96 paisa at 95.37 on 2m shares and Arif Habib Corporation, steady by 69 paisa at 27.59, also on 2m shares. They were followed by Nishat Mills, up27 paisa at 40.76 on 1.110m shares, PTCL, steady by seven paisa at 10.25 on 1.105m shares and MCB, higher by Rs1.22 at 148.05 on 0.100m shares.
FUTURE CONTRACTS: Fauji Fertiliser led the list of actives, up Rs1.63 at 163.10 on 0.572m shares followed by Fauji Fertiliser Bin Qasim, firm by 30 paisa at 43.77 on 0.528m shares and Engro Corporation, steady by 97 paisa at 95.77 on 0.502m shares.
National Bank followed them, up 51 paisa at 42.51 on 0.455m shares and MCB, higher by Rs1.21 at 148.42 on 0.171m shares.
DEAFAULTER COs: The active list in this sector was led by Saritow Textiles, easy by eight paisa at Rs1.41 on 12, 026 shares followed by Dost Steel, firm by four paisa at 1.16 on 8, 439 shares and Genertech Power, easy one paisa at 0.34 on 9,404 shares.

Stock market loses 110 points

KARACHI, Jan 14: The KSE-100 index sank another 110 points in the week ended on Friday, closing at 11,014.
Despite the week-on-week decline of one per cent, the saving grace was the sharp pull back by 105 points on the last trading day, which enabled the index to close at above the psychological level of 11,000 points.
The average trade value during the week plunged by a massive 30 per cent week-onweek to settle at $178 million and average volumes fell as low as 28 million shares.
Market capitalisation stood down 1 per cent to Rs2.867 trillion, from Rs2.893 trillion or to $31.75 billion, from $32.11 billion.
Overall, the dull activity was responsible for the underperformance of Pakistan equities by 3 per cent to the regional market.
A chart by Furqan Ayub, analyst at JS Global, showed China`s gain during the week by 3.8 per cent; Philippines 2.9 per cent; India and Korea 1.8 per cent and Indonesia 1.7 per cent.
But for all that a redeeming factor for the Pakistan equity market was the foreign portfolio inflow of $0.18 million, compared to relatively heavy outflow amounting to $6.7 million the earlier week.
Remittances sent by overseas Pakistanis also rose 19.5 per cent to $6.3billion in first six months of current financial year, compared with $5.3billion in the same time last year.
The December remittances also increased 26 per cent to $1.1billion, compared with December of the year before.
Traders said that investors had remained sidelined during the week, fearful of increasing heat on the political front. The market plunged earlier in theweek as relationship seemed to sour between state institutions when the Prime Minister raised concerns over the recent actions of the military leadership that in turn drew a sharp rebuttal from the latter.
The government and the judiciary also appeared to be heading on a collision course as the apex court censured the PM over failure to implement the court`s NRO verdict and outlined six measures which were required to be undertaken in response.
Analysts at KASB Research attributed the Friday`s `relief rally` to reports that the SECP had forwarded taxation proposals to the FBR calling for a revision in mechanism for capital gains tax collection, lowering corporate taxes for listed companies (from 35pc to 25pc) and introducing an amnesty scheme for brokers and investors to pay a nominal income tax.
Apart from this, sector-specific news flow saw the Prime Minister inaugurate KunnarPasakhi Gas Pipeline Project field, which was thought to hold reserves of 100mmcfd gas and 1100 bpd of oil.
According to analyst Yawar UzZaaman at brokerage firm InvestCap, the Friday recovery owed itself to `SECP`s investment-friendly proposal to FBR with respect to capital gains tax (new collection mechanism with amnesty scheme), reduction in corporate tax rate and increase in tax on national savings schemes.
Investor sentiments were dampened by the trade deficit, which for the 1HFY12 stood at $11.5billion, rising by a huge 38.5 per cent year-on-year.
Regarding specific stock performances, major gainers during the week were noted to be Shifa International Hospitals Ltd, TRG Pakistan,KESC, Colgate Palmolive and Jahangir Siddiqui & Co.
Biggest losers were Pak Telephone, Nestle Pakistan Limited, International Steel Limited, Dawood Hercules and Al-Ghazi Tractors.
Fertilizer scrips gained on urea price hike, consequently outperforming the market by around 5 per cent.
Among other blue chip stocks, MCB Bank and Lucky Cement outperformed the market by 3 per cent and 2 per cent, respectively, on the back of attractive valuations.
With the political situation dicey, most market pundits were unwilling to hazard an outlook.
Analyst Yawar at InvestCap stated that as the Supreme Court`s larger bench was set to take up key issues concerning the current political setup, the market was expected to remain jittery the week that follows.
However, rising oil prices, coupled with any positive development from the FBR on SECP`s proposal, could provide much-needed impetus to equities. KASB Research also said that politics was likely to set the tone for market direction going into next week.
However, with corporate result season around the corner, some of the spotlight may shift away from the political noise.
Analysts also would keep watch on preliminary news flow emerging on the IMF Letter of Comfort and the Monetary Policy Statement scheduled to be announced latter this month.
The IMF`s detailed report was expected to be a `trump card` in determining the direction and extent of future sovereign flows.
It also was thought to have implications on the dollarrupee exchange rate.

Investment inflow drops

KARACHI, Jan 14: The states which were earlier major investors in Pakistan have either left or have made minimum or insignificant investment, shows data issued by the State Bank of Pakistan.
The US, UK and UAE were prime investors in the country in 2006-07, but their investment is now at a minimum level.
Total investment by the three countries was to the tune of $2434 million in 200607, but it has now shrunk to $731 million, according to the data.
China, which invested $713 million in fiscal year 2007, withdrew its investment in fiscal year 2009, 2010 and invested just $47 million during the fiscal year.
Saudi Arabia followed the same path as it withdrew investment during the same period, and invested just $6 million. It had invested $103 million four years back.
The trend of foreign investment in Pakistan is against global trend as most of the developing countries are receiving massive FDI,` said Aabid Saleem, a researcher and analyst.
The situation, he said, also speaks about worst economic environment prevailing forthe last four years. The poor economic environment was the direct outcome of the deteriorating law and order situation.
Analysts do not find any change in economic or internal political situation that could be attractive for foreign investors.
The State Bank also said in its annual report that investors` concerns over governance issues, energy and prevailing security situation prevented growth in foreign direct investment in Pakistan.
Foreign investment, which can play an important role in supporting domestic investment and growth within a resource-constrained economy, continued to decline in Pakistan for four consecutive years in FY11.
Foreign investments have energised new economies, like China, India and Brazil, experts said, adding the glut of liquidity available at the global level could help Pakistan attract a share out of it, but the law and order situation and energy crisis have barred them from landing into the country.
The glut of liquidity is rising at the global level due to shortage of investment opportunities.

Mohammed Saleem Mansoori