Bulls gain control of stock market

The Karachi share market on Monday witnessed a bullish session with KSE-100 crossing 13,500 points level on the back of fresh buying mainly in banking and oil sectors by both local and foreign investors, and closing at its new high level of 13,567.40 points, with a surged of 128.93 points. The KSE-30 index gained 153.83 points, closing at 16,906.48 points level.
The start of the market was positive and the bulls gradually strengthened their positions with increasing confidence. But the ready market volumes declined to 257.274 million shares as compared to 271.261 million shares traded on last Friday. The futures market turnover also decreased to 47.206 million shares against 62.834 million shares.
Market capitalisation surged by Rs 30 billion to new high of Rs 3.927 trillion. Trading took place in 407 scrips, out of which 258 closed in positive column and 113 closed in negative column while the value of 36 scrips remained unchanged.
OGDC was the star performer of the day with 20.920 million shares and surged by Rs 1.75 to close at Rs 122.35. It was followed by DG Khan Cement which gained Rs 1.55 to close at Rs 116.95 with a volume of 17.539 million shares. Lucky Cement also increased by Rs 2.45 to close at Rs 123.90.
The BoP and Askari Bank surged by Rs 3.25 and Rs 0.65 to close at Rs 116.00 and Rs 100.75, respectively. PSO was active on the back of its privatisation process and gained Rs 13.30 to close at Rs 418.30.
PTCL increased by Rs 0.65 to close at Rs 54.65 while Telecard gained Rs 0.45 to close at Rs 11.60. Fauji Fertiliser Bin Qasim surged by Rs 0.10 to close at Rs 37.95. Arif Habib Sec performed well and the scrip gained Rs 5.80 to close at Rs 122.00.
Jangir Siddiqui Co and Sanofi-Aventis were the highest gainers which gained Rs 17.75 and Rs 16.20 to close at Rs 372.75 and Rs 340.30 respectively, while Wyeth Pak and Colgate Palmolive were the highest losers which lost Rs 96.15 and Rs 20.00 to close at Rs 1827.60 and Rs 460.00 respectively.
Ahsan Mehanti at Shehzad Chamdia Securities said that local retail investors and institutions were active in oil related scrips on the back of petroleum policy to be announced by the end of this month. Higher oil prices in the international market invited fresh buying in the sector.
Banking sector was also active following the news that all new taxes on banks announced in the budget will be applicable from the tax year 2009. The SBP decision to allow the financial institutions for foreign borrowing also created positive sentiment, which invited fresh buying, while foreign buyers mainly took fresh positions in banking stocks.
Hasnain Asghar Ali at Aziz Fidahusein Securities said that rising trend in oil prices in the international market and unconfirmed news regarding date for conversion of draft of petroleum policy to the formal policy allowed the under-valued sector to gear up for bull-run.
Although turnover stayed low on opening, the KSE-100 index was taken care of by price appreciation in PTCL, PSO (privatisation mania) and leading oil and gas exploration stocks. Therefore, despite sell-on-strength views in almost all high priced stocks, the index managed yet another record highest closing at 13,567.
Technically, the ability of the index to successfully close above technical resistance of 13,550-13,557 would allow it to charge further as the next resistance stays at 13,693-13,700, while intra-day support hesitates to move up. In case of adjustment, the major support stays at 13,270-13,277.