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Rate cut fails to woo KSE investors as rupee sinks again

Souce:Xinhua Publish By Updated 18/12/2012 6:07 am in Business / no comments


by Jawad Hussain

KARACHI, Dec. 17 — A 50 basis points decline in key interest rate failed to excite investors at Pakistan’s Karachi Stock Exchange (KSE) on Monday as the declining value of national currency against greenback superseded the market sentiments thus forcing bears to take center-stage.

The State Bank of Pakistan, on Friday, announced its monetary policy statement for the months of December and January and cut its benchmark interest rate by 50bps to 9.5 percent, a decision widely anticipated by the market participants.

However, rupee continued to slide against U.S. dollar in money market on Monday which affected the investors’ sentiments drastically and they resorted to take an exit from trading activities which resulted in lower participation but the main index still managed to keep the psychological 16,800 levels.

The KSE 100-Index lost 0.26 percent or 44.07 points to close at 16,801.02 levels on Monday as against close of 16,845.09 levels recorded on Friday with turnovers falling below 100 million shares which reflected lack of interest by the local investors.

The KSE All Share Index dipped by 0.13 percent or 15.94 points to end at 11,881.37 levels on Monday as against Friday’s 11,897.31 levels, the KSE 30-Index dropped 0.2 percent or 27.53 points to conclude at 13,610.06 levels on Monday as against Friday’s 13,637. 59 levels, whereas the KMI 30-Index fell by 0.2 percent or 57.69 points to finish the day at 28,815.76 levels on Monday as against close of 28,873.45 levels reported on final trading session of the previous week.

The Karachi Stock Exchange commenced fresh week on a bearish note and all the initial expectations of bullish trade were vanished by continuous decline of Pakistani rupee against U.S. dollar.

However, some institutional interest was noticed in Fauji Fertilizer Bin Qasim and Fauji Fertilizer which helped the main index to regain the positive momentum for sometime during which it managed to go beyond 16,900 levels and soon hit an all time high of 16,931.84 levels just before the halfway stage.

After hitting its all time intraday peak, the key index faced consistent selling pressure across the board which sucked the air out of the bulls’ balloon in the second half and the main index hit the lowest level of the day of 16,784.93 before managing to close above 16,800 levels.

Market volumes plunged by 37.898 million shares to 91.588 million shares on Monday as against trading of 129.486 million shares recorded on Friday as investors opted to take an exit from the market proceedings.

Market capitalization declined by 5.651 billion rupees (59.489 million U.S. dollars) to 4.211 trillion rupees (44.335 billion U.S. dollars) on Monday when compared with market capitalization worth 4.217 trillion rupees (44.395 billion U.S. dollars) reported on final trading session of the previous week.

The Karachi Stock Exchange’s trading value slumped by 1.567 billion rupees (16.498 million U.S. dollars) to 2.518 billion rupees (26.506 million U.S. dollars) on Monday when compared against Friday’s trading value of 4.085 billion rupees (43.005 million U.S. dollars).

As per the figures released by the National Clearing Company of Pakistan Limited (NCCPL), the foreign investors have net sold shares worth 291.959 million rupees (3.073 million U.S. dollars) during first two weeks in the month of December at the top Pakistan bourse.

In broader market, a total of 355 companies changed hands during the course of trading on Monday where prices of 204 issues declined in the red ink, 129 closed in green territory, whereas values of 22 other scrips stayed unchanged at previous week’s levels.

Maple Leaf Cement was the top traded company on Monday with trading of 14.750 million shares in its scrip, followed by Tariq Glass Industries, Jahangir Siddiqui Company Limited, Fauji Cement, Byco Petroleum, National Bank of Pakistan, NIB Bank Limited, Dera Ghazi Khan Cement, Pak Elektron Limited, and Nishat Chunian Power with turnovers of 5.164 million shares, 3.597 million shares, 3. 522 million shares, 2.800 million shares, 2.635 million shares, 2. 045 million shares, 2.039 million shares, 1.911 million shares, and 1.696 million shares, respectively.

Nestle Pakistan Limited, Unilever Food, and UniLever Pakistan were the top three price gainers of the day. Nestle Pakistan Limited surged by 149 rupees (1.56 U.S. dollars) a share to close at 4,850 rupees (51.05 U.S. dollars); Unilever Food gained 100 rupees (1.05 U.S. dollars) per share to end at 4,300 rupees (45.26 U.S. dollars); and UniLever Pakistan increased by 80 rupees (84.21 U.S. cents) to culminate trading activities on Monday at 10,100 rupees (106.315 U.S. dollars).

On the other hand, Salfi Textile, Murree Brewery, and National Foods were the top price shedders on Monday. Salfi Textile went down by 7.82 rupees (8.23 U.S. cents) to close at 148.69 rupees (1. 56 U.S. dollars); Murree Brewery shed 7.75 rupees (8.15 U.S. cents) per share to end at 147.25 rupees (1.55 U.S. dollars); and National Foods declined by 6.78 rupees (7.13 U.S. cents) a share to finish the inaugural day of the week at 275 rupees (2.89 U.S. dollars).



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