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Share index resists major decline on active short-covering

KARACHI — Pakistani stocks yesterday resisted larger decline followed by active short-covering at the lower levels on the blue chip counters triggered apparently by reports that a draft of constitutional package is ready, aiming at reinstatement of judges after the parliament nod.

The reports that the package will also trim president's powers, among other things, to dissolve assemblies buoyed most of the investors on the perception that the amendment will lead to political stability, said a leading analyst Ahsan Mehanti.

After hitting the session's high of 13,984.02 and low at 13,657.45 respectively, the KSE 100-share index managed to finish around 13,903.12, recouping a good part of the initial fall. But on the other hand the free-float 30-share index recovered 37.76 points at 16,417.58.

The mid-session rally was aided by active short-covering in some of the leading shares, motably Arif Habib Securities, Engro Chemical, National Bank, Bank Al Falah and some others.

"The news of reinstatement of judges, and the market's highly oversold position could take to any highs during the next couple of sessions if the sailing of the constitutional package in the parliament is smooth," analyst Hasnain Asghar Ali predicts.

But he said the prevailing scare among the investors, notably foreign ones would only be eliminated if coalition partners remained united on the package and let it got through the parliament with one voice.

"A much damage has already been caused to the share business by negative and conflicting statements by the political leaders wiping out billion of rupees from the market capital during the last couple of weeks and the market would cherish the return of sanity on this count," analyst Ashraf Zakaria thinks.

Among the leading gainers, AKD capital and JS & Co were leading, up by Rs53.59 and 25, while EFU Life and EFU General Insurance led the list of losers, off by Rs25.17 and 24.00.

Trading volume showed a modest rise at 168 million shares from the previous 125 million shares but losers held a fair lead over the gainers at 199 to 109, with 31 shares holding on to the last levels.

Arif Habib Securities led the list of actives, higher by Rs5.40 at Rs186.50 on 11 million shares followed by Fauji Fertiliser Bin Qasim, firm by 75 paisa at Rs37.75 on 9 million shares, Engro Chemical, shaprly higher by Rs6.30 at Rs314.30 on 8 million shares.