The market during the session made a high of 7040 and low of 6949, but bulls stampede never allowed the bears to take an upper hand. Buying in banks and gas scrips allowed the index to comfortably sailed above 7000 level. The OGDC was the major gainer followed by the Bank of Punjab, MCB, National Bank, and Askari Bank.
Hasnain Asghar from Aziz Fidahusein, said that improving macro-economic environment and positive response by the donors countries and the international investors depicted by warm response to Expo - 2005, and interest shown in the privatisation process helped the index to cross the yet another landmark of 7000.
Expected healthy corporate earnings of the leading commercial banks allowed activity in the sector. Technically, however, the inability of the index to close above 7030 indicates a mild adjustment, the support stays around 6967-6975, and the index would continue to face resistance around 7093-7105 while mild resistance stays at 7040-7047.
Consistency in economic activities and improvement in investment environment will allow the index to continue the surge as the on-going development would continue to invite fresh funds.
Engro Chemical, on the back of news regarding Dawood Hercules wanting to pick up more shares of the company, was one of the index movers of the session, going up Rs 6.25 to close at Rs 129.25.
The day once again undoubtedly belonged to the banking scrips, showing an across-the-board exceptional performance. The Bank of Punjab, Askari Bank, Bank Alfalah, MCB, and National Bank gained 5.6 percent, 4.1 percent, 3.4 percent, 2.0 percent, and 1.9 percent, respectively. The Bank of Punjab buoyed on tremendous earnings and bonus pay out expectations in its forthcoming FY04 financial results.
The oil and gas scrips, PPL and PSO were also firm, depicting a modest gain of 1.1 percent and 0.6 percent, respectively. The Engro gained 5.1 percent as rumours were rife that the company may announce a hefty bonus payout in its financial results next week in order to thwart a potential take-over attempt by the Dawood Group in the future, an analyst from Live Securities said.
Some profit-taking was witnessed in the cement sector as the January 2005 demand growth figures depicted a significant slowdown.
Going forward, the privatisation story and upbeat corporate profitability is expected to maintain the positive momentum. The short-term profit-taking is advised around the 7100 point level.
Ahmed Ashraf Sheikh from Akbarally Cassim, said the badla increased by 880 million rupees. There was major badla increase in National Bank of Pakistan by 20 percent as investors expect good corporate results and payout. The badla levels in other items remained mostly stagnant as weak-holders held on to their positions. The badla levels continued to remain limit up.
OGDC gained Rs 1.15 to Rs 85.45 on a volume of 106 million shares, Bank of Punjab moved up to Rs 77 from Rs 72.90 on a trading of 71 million shares, PTCL rose five paisa to Rs 63.30 on a business of 59 million shares, MCB denoted an increase of Rs 1.45 to Rs 75.25 on deals of 34 million shares, and National Bank closed at Rs 103.30, ie higher by Rs 1.90 on transaction of 32 million shares.