The delay in privatisation of the Pakistan Telecommunication pre-bid meeting played havoc, and the market underwent heavy selling pressure, falling by almost three percent, where other state-run companies listed also suffered the bears onslaught on Thursday at the Karachi Stock Exchange (KSE). The KSE-100 index declined by 213.57 points, or 2.85 percent, to 7284.05 as compared with 7563.12. The turnover rose to 514 million shares as against 465 million shares.
The market witnessed a major turnaround when the news of delay in privatization of the telecom giant PTCL roared at the day, and injected enormous adverse sentiments into the stocks that pushed the KSE-100 index from 67 points in the positive zone to 213 in the negative to close at 7284.
Abbas Raza, research analyst, First Capital Securities, said the projected posture during the past few days was finally practised as investors flew towards the profit-taking stance, leaving no chance to rumble the onslaught. Wednesday''s upturned PSO was the major loser in absolute terms when the scrip fell Rs 19 to close at Rs 373.9, another shining lime waiting in turn for the privatisation act.
The privatisation gossip is likely to trigger further activity and rule the market scenario until the transactions of the corporate giants PTCL and PSO are actually conducted.
An analyst from Atlas Investment Bank, said that profit-taking and a subsequent selling pressure dominated, as the KSE could not sustain its movement in the positive zone. Before noon, the pressure exerted by news in the media about a delay of two weeks in the bidding date of PTCL caused the pressure. With a 109 basis point increase in the badla volume on Wednesday, weak-holders liquidated their positions, resulting in massive decline in share prices.
However, high volumes of 515 million, which is a 10 percent rise from a day earlier, was remarkably a significant feature for the market punters. Another positive development in this correction was the fact that blue chips did not reach their lower locks.
OGDC saw a massive selling, as it went below the Rs 100 level to close at Rs 97.95 down Rs 4.35. PPL and PSO also landed in negative territory contributing 27 and 13 points respectively to the fall of the index.
Tanivr Abid, head of research from Live Securities, said the market sentiment was weakened on the reports that the State Bank of Pakistan is considering another major hike in its discount rate as early as this week.
The expected rise in the discount rate is attributable to uncontrollable mounting inflation. This triggered a massive across-the-board slide. The media and electronic reports that PTCL''s bidding would be held on June 10, 2005 also failed to support investors'' sentiment.
PTCL after making an intra-day high at Rs 72.50 declined by 4.1 percent, closing well below the psychological Rs 70 barrier.
Going forward, concerns of a rise in the discount rate will haunt investors. Nonetheless, we feel that the index will recover under the privatisation weight. PTCL, PPL, PSO, OGDCL and FFBL are noteworthy scrips to look at, he added.
PTCL on a business of 224 million shares lost Rs 2.90 to Rs 68.20, OGDC slipped to Rs 97.97 from Rs 102.30 on a turnover of 126 million shares, Pakistan Oilfields closed at Rs 274.25, ie lower by Rs 2.75 on trading of 27 million shares, NBP moved down to Rs 95.25 from Rs 98.60 on trading of 22 million shares, and PSO declined by Rs 19 to Rs 373.90 on deals of 21 million shares.
Comments
Comments are closed.