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Monday, 3 September 2012

STOCK MARKET UPDATE: 04.09.2012



STOCK:
Karachi Stocks  Up 25.58 Points:
KARACHI, Sep 03: At the close of trading, the KSE-100 index was at 15417.16, up 25.58 points. 
 (TODAY: MARKET MINUS 9.25 …10.49 AM)
September 3, 2012
5 TOP GAINERS  &  LOOSERS:

Wyeth Pak Limited.
Rs 48.00
Indus Dyeing
Rs (19.99)
Indus Motor Co
Rs 13.72
Abbott Laboratory
Rs (9.75)
Bata (Pak) Limit
Rs 13.70
Colgate Palmolive
Rs (5.00)
Exide (Pak)
Rs 13.43
Javedan Corporation
Rs (4.10)
Mithchells Fruit
Rs 12.75
Linde Pakistan
Rs (2.99)
Stock Market Gain 36 points
KARACHI, Sept 3: Shares moved forward, though with clipped gains on Monday. The KSE-100 index rose 36.91 points to close at 15,428.49 points.
The market saw great deal of volatility trading between the high of 15,480.77 and low of 15,391.58 points.
Traders said that since the satisfactory inflation numbers for Aug at 9.05 per cent, were released near the close of the market on Friday, its positive impact was expected to be seen in the market on Monday.
The market thus started on a firm trend as investors expected a further cut in SBP Monetary Policy. The possibility of Pakistan’s re-entry into the “Emerging markets”, from which it was pushed to the “Frontier markets” in MSCI index was hoped to attract greater foreign investor interest in the Pakistani stocks, though the actual implementation of a positive response of MSCI officials to the presentation by Pakistan’s capital market participants in London, would be a little far until June 2013.
Analysts also reminded that financial results of some of the ‘big ticket’ companies were still awaited that could boost share prices. Yet, as the index came close to its all-time high level attained four and half years ago, investors, particularly the retail and week ones were beginning to feel dizzy.
As a large number of them decided to stay on the sidelines, the volume dipped to 201 million shares of the trading value of Rs5.8 billion, from 242 million shares valued at Rs7.8 billion.
Ahsan Mehanti at Arif Habib Corp said that the blue chip stocks in telecom, oil sector led the rally amid interest in third tier stocks on strong valuations leading the index to close near session high. Renewed foreign interest, higher global commodities affected the sentiments despite concerns for security issues in the city.
Hasnain Asghar Ali, COO at Escorts Capital commented that though volumes were led by telecommunication stocks, dips in various frontline stocks invited placements. Banking frontline scrips kept the accumulators on the front foot thus keeping the banking stocks on gaining ground.
The deficit numbers, US dollar reserves, debt retirement and circular debt continue to disallow aggressive stance. Various factors mainly declining trend in local interest rates, likelihood of removal of investment barriers for across the border funds would keep the equation balanced.
Among the 320 active stocks on Monday, 174 stood as gainers; 125 losers and 21 remained unchanged. Market capitalisation decreased by Rs.12 billion to Rs3.932 trillion, from Rs3.919 trillion.
The highest gainer for the day was Wyeth Pak Limited, up by Rs48 to Rs1,008, followed by Indus Motor Company hitting the upper lock of Rs13.72 to Rs288.22.
Auto stocks generally turned strong on week-end news about some more indirect restrictions on imported cars. The main laggard was Indus Dyeing, down by Rs19.99 to Rs380.20 and Abbott Lab lower by Rs9.75 ex-dividend at Rs204.07.
The volume leader was once again PTCL with trading in 21m shares, limit up by Re1 to Rs19.04 as optimism on a positive outcome over the LDI issue kept sentiments buoyed. For the same reason, Telecard gained 11 paisa to Rs3.02 on 12m shares, though WorldCall Telecom slipped by 24 paisa to Rs3.05 on 14m shares.
Engro Foods gained Rs1.30 to Rs73.05 on 10m shares, as investors see potential in most FMCG producing companies. While the two major cement stocks went backstage, Maple Leaf saw the highest volume in the sector at 9m shares, up by 99 paisa to Rs8.26, Fauji Cement was up by 22 paisa to Rs6.72 on 6m shares, Lafarge Pakistan edged higher by 17 paisa to Rs5.64 on 5m shares. Engro Corporation gained Rs1.63 to Rs106.79 on 8m shares.
Pakgen Power, trading spot, shot limit up by Re1 to Rs15.32 on 7m shares. National Bank of Pakistan jumped up by 37 paisa to Rs46.41 on 5m shares.
Foreigners park $51m in stocks
KARACHI, Sept 3: During the month of August, net foreign portfolio inflow into the equity markets amounted to a tall order of $51 million.
Much of that, however, was ‘off market’ transactions in two companies: The first of around $6.0 million worth shares in Bata (Pakistan) and second, the $30 million equity in Colgate-Palmolive. While the shares in Bata (Pakistan) were purchased by the Parent Bata (Nederland) BV, whose ultimate parent is Compass Limited Bermuda; the buyer in Colgate-Palmolive stock was not identifiable except that it was an ‘emerging market consumer fund’.
The market men are cherishing the deals as a good omen, for a foreign inflow in ‘blue chip’ companies suggests overseas investors’ confidence in the country’s ability to deliver high yields on investment and the prospects of good growth in corporate profitability.
“While we lament the departure of foreign sponsors from Hub Power Company and ICI, the entry of overseas investors in other companies should be happy augury,” says a market participant.
Analysts who track foreign portfolio trend in equity market say that the Bata’s parent has been continuously collecting shares from the market.
On Dec 31, 2010, the Nederland-based shoe maker’s controlling stake in Pakistan subsidiary was 4.5 million shares, representing 60pc of the company’s paid-up shares of 7.56 million.
By the close of financial year to Dec 31, 2011, Bata (Netherlands) N.V had scaled its stake to 5.10 million shares or 67 per cent of the total. In August this year, the parent bought another 0.588 million shares from the market in ‘off-market transactions’, adding 7.8pc to its controlling shares, which rose to 75 per cent. There is, however, some concern among market participants on the price of deals.
A market watcher said that a brokerage house had acquired 0.578 million shares in the ‘off-market’ deal at Rs920 per share from NBP, the second biggest shareholder in Bata (Pakistan) with 1.77 million shares or 23 per cent of the paid-up capital.
From the figures of ‘off-market transactions’ posted on the KSE site, it looks like the buyer (or intermediary) held on to the stocks for a couple of days and filled the overseas parent’s order in two separate ‘off-market’ transactions on Aug 29 and 30 at Rs1,000 per share. Did some one, then pocket the difference of Rs80 per share and make a cool Rs46 million in the deal in less than a week?
Company news:
BankIslami posts Rs229m profit: KARACHI, Sept 3: BankIslami Pakistan Ltd on Monday reported a net profit of Rs229 million with a growth of 22.6 per cent in deposits, 21.6 per cent in assets and 80.1 per cent increase in its earning per share.
The bank also commenced its network expansion after three years of consolidation and plans to expand its branches to 200 by the end of 2013. It currently has more than 110 branches in 54 cities of Pakistan.
BankIslami is also the first start up bank to clear all its accumulated losses, its most significant feature of its financial performance, it said in a statement.
“We are obviously pleased with our performance and look to the future with greater optimism,” said Hasan Bilgrami, CEO of BankIslami.
“Specifically, we would like to be one of the top ten banking networks in the next few years significantly increasing our market share in the Islamic banking segment and banking industry on the whole.”
MOHAMMED SALEEM MANSOORI

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