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Thursday, 7 February 2013

STOCK MARKET UPDATE: 08.02.2013



STOCKS
Karachi Stocks Up 67.73 Points:
KARACHI, Feb 08: The KSE-100 index was at 17451.05, up 67.73 points.  (@ 11.51 am)


February 7, 2013
5 TOP GAINERS  &  LOOSERS:

Unilever Pak
Rs 468.75
Indus Dyeing
Rs (25.63)
Nestle Pak
Rs 204.00
Sapphire Textile
Rs (11.52)
Bata Pakistan
Rs 45.00
Sitara Chemicals
Rs (4.18)
Colgate Palmolive
Rs 25.00
Premier Suger
Rs (3.75)
Mithchells Fruit
Rs 10.20
Murree Brewery
Rs (3.70)

KSE 100-index sheds 25 points
KARACHI, Feb 7: Stocks pulled back by 25.20 points on Thursday with the KSE-100 index ending at 17,383.32 points. Although the bulls were in complete charge at the start of trading when the index added another 70 points to reach the intra-day highest ever level of 17,487.24 points, subsequent profit taking, saw the index hit the day’s lowest at 17,370.94 points, before recovering much of the losses.
Investors were expected to book profit after the heavy gain of 120 points the earlier day. Yet, selling came some time after the bulls were exhausted at near the 17,500 level. Volume of trade on Thursday stood at 311 million shares, which though lower than the 10-month high 336 million shares traded on Wednesday, was again above the 300 million mark.
Trading value dipped by 47 per cent to Rs5.067 billion, from Rs7.459bn, as the activity was concentrated in second and third tier stocks.
Foreign investors were buyers of equity worth net $1.45m, compared with net buy of $3.92m the previous day. In the first week of Feb, the net foreign buy stood at $1.16m, which was addition to the Jan full month buy of net $15.42m worth equity.
Among the local participants, mutual funds sold shares of the value of $1.88 million. Investors seemed to await the SBP Monetary Policy Statement due Feb 8, though consensus forecast suggested a status quo on the policy rate at 9.5 per cent.
Beside, political and judicial matters also impacted investor sentiments and things remained murky on those fronts.
Manager Equity Sales, Topline Securities stated that profit taking was seen after market hit all time high (on closing basis) a day before. Small telecom related shares like Telecard and WorldCall remained in the limelight.
PTC with decent volume saw profit taking as it had rallied in the last few sessions. MCB Bank financial results also failed to excite market as investors squared their positions after lower than expected results.
Hasnain Asghar Ali at Escorts Capital commented that the equity market entered the correction phase after hitting yet another historic high wherein telecom stocks led by PTC witnessed massive volumetric reshuffling ahead of announcements as the confusion on international call revenues persist.
Post results sell-off in MCB Bank pulled down the entire banking sector. The cement stocks also were generally dull on account of decline in dispatches last month.
Economic review statement by the credit rating agency, Moody’s only went on to accelerate selling as it endorsed the already highlighted disturbing economic picture.
Market capitalisation stood about unchanged at Rs4.348 trillion on Thursday, compared to Rs4.347 trillion the previous day. In all, 348 stocks came up for trading, with 189 in losses, 127 gainers and 32 unchanged.
UniLever Pak was the biggest gainer for the day, which added Rs468.75 to Rs10,543.75 followed by Nestle Pakistan, up by Rs204 to Rs4,905.
On the losing side, Indus Dyeing fell by Rs25.63 to Rs542 and Sapphire Textile declined by Rs11.25 to Rs213.75.
On the active list, TRG with volume of 56 m shares, declined by 46 paisa to Rs7.82. It was followed by Telecard adding 13 paisa to Rs4.69 on 27m shares; WorldCall Telecom up by 6 paisa to Rs3.55 on 25m shares.
Jah Sidd Co gained 38 paisa to Rs17.04 on 19m shares; Byco Petroleum was firm by 18 paisa to Rs14.26 on 19m shares; PTCL conceded 85 paisa to Rs19.46 on 18m shares; Wateen Telecom rose by 33 paisa to Rs3.67 on 16m shares; PIA was up by 64 paisa to Rs4.16 on 13m shares; KESC shed 8 paisa to Rs6.29 on 9m shares and Fauji Cement slipped by one paisa to Rs7.83 on 8m shares.
Profit-booking brings all-time high KSE down: KARACHI: Apex bourse closed lower on Thursday with investors cashing in shares after the market hit an all time high the previous day before.
The Karachi Stock Exchange's (KSE) benchmark 100-share index ended 0.14 percent, or 25.20 points, lower at 17,383.32.
There was a higher volumes of trading of shares in the Pakistan Telecommunication Corporation, with some investors booking profits after it rallied in the last few sessions. Small telecom-related shares like Telecard Ltd and World Call Telecom remained popular.
Telecard Ltd rose 2.85 percent to 4.69 rupees.
Pakistan Telecommunication Corporation fell 4.48 percent to 19.40 rupees.
In the currency market, the rupee ended weaker at 97.85/97.92 against the dollar, compared to Wednesday's close of 97.82/97.87.
Overnight rates in the money market remained flat at nine percent.
SBP may keep policy rate unchanged
KARACHI, Feb 7: An overwhelming majority of analysts expect the State Bank of Pakistan to keep its key policy rate unchanged at 9.5 per cent due to inflation picking up pace again and pressure on the rupee, when it meets on Friday to unveil its monetary policy.
The central bank has already made an aggressive cut of 200 basis points to 9.5 per cent during FY13 in an attempt to spur economic growth.
Eight, of the 10, analysts polled by Dawn expect the SBP to keep the discount rate flat amid rising inflation, pressure on the local unit coupled with International Monetary Fund (IMF) repayments.
After hitting a low of 6.93 per cent year-on-year in November last year, the consumer price index (CPI) accelerated for the second consecutive month as it stood at 8.07 per cent year-on-year in January. CPI also increased 1.7 per cent over December.“It now seems the economy is on the lookout for inflation to come roaring back. If consumer prices continue unimpeded, the possibility for an interest rate reversal towards the end of the FY13 will certainly rise. We expect the central bank to go with the status quo on policy rate due to currency risk (high IMF repayments in Feb-13 onwards) and subsequent inflationary risks that may prevail amid political transition, set aside rising government inflationary borrowing,” brokerage house Arif Habib Ltd said in a note.
Inflation started accelerating for the first time in seven months in December and continued to do so in January primarily due to higher food and gas prices.
Rupee has also been touching record lows as it is trading close to Rs98 to the dollar in the interbank and approximately Rs100 in the open market.
Pakistan is also due to make a repayment to the IMF of over $500 million this month which seems to be a grave cause for concern as the country’s foreign exchange reserves are continuously depleting.
Reserves stood at $13.474 billion with the central bank’s reserves just at $8.586bn in week ended Feb 1, which puts Pakistan’s external sector in a precarious state and leaves little room for a rate cut.
Average inflation for the first seven months of 2012/13 was 8.3 per cent and is expected to be within the government’s full-year target of 9.5 per cent, but it seems to be elevating and fast becoming a major concern.
“Even though 7-month FY13 CPI average at approx 8.3 per cent y-o-y, implying positive real interest rate of one per cent, we believe SBP will adopt a cautious stance in the upcoming monetary policy. In this regard, core trimmed inflation is nearly back to double digits and has averaged 9.9 per cent in 7MFY13. Considering a weak external account amidst IMF talks, any further decrease in the discount rate appears unlikely. We see increases to the discount rate later on in the year but believe the SBP may take a wait-and-see approach for now,” said Anum Dhedhi, economist at AKD Securities Ltd.
However, two analysts believe SBP may further cut its policy rate by 50 basis points to boost the economy and be able to provide the private sector with cheaper credit.
“SBP Annual Report hints at softer inflation and weaker growth outlook. This typically is a prelude to a rate cut. SBP might move for a 50bps cut given the slowdown in private credit growth. But what the IMF and other independent experts tell us is that weak forex reserve position is a serious risk to USD/PKR outlook and hence inflation. Rise in oil prices to $116 per barrel is another key risk,” said Sayem Ali, economist at Standard Chartered Bank.

Company News:
MCB Bank declares dividend: KARACHI, Feb 7: MCB Bank on Thursday announced final cash dividend of Rs3 and 10 per cent bonus shares, in addition to interim cash dividends of Rs10 already paid for the year ended December 31, 2012.
The bank in a statement stated that the earnings per share (EPS) for the year came to Rs22.77 compared to Rs21.12 for December 31, 2011. Return on assets came to 2.95pc; return on equity was recorded at 25.07pc and book value per share improved to Rs95.84.
Total assets grew by 17pc to Rs765.899 billion. The analysis of the asset-mix highlights 27 per cent increase in investments to Rs402.069bn and 5pc increase in gross advances to Rs262.392bn.
The quality of asset saw considerable improvement as the non-performing loans of the bank reduced by 4pc to Rs25.562bn reflecting improvement in infection ratio as of December 31, 2012.
The deposit base grew by 11pc closing at Rs545.061bn with 18pc increase in saving deposits, 13pc increase in current deposits and 12pc decrease in fixed deposits.
For the year 2012, the bank reported profit before tax of Rs32.054bn and profit after tax of Rs20.941bn with an increase of 2pc and 8pc, respectively.
Net markup income was reported at Rs40.856bn whereas non-markup income registered an increase of Rs1bn owing to 16pc surge in fee, commission and brokerage income and 19pc increase in dividend income during the year, said the bank statement.

MOHAMMED SALEEM MANSOORI

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