Market came in for profit taking after last week’s gains closing below 9,000. Barring PPL which was strong throughout the day, oil stocks underwent selling at current levels given some stocks were now trading near their fair values. OGDC finally closed in the red after having performed exceptionally well over the past few weeks as was the case for banks despite some positive news with respect to a possible enhancement of forced sale value advantage for financials carrying bad loans. With an overbought market, and probably not so aggressive foreign funds participation, local funds preferred to sell with a view to buy back at lower prices. News reports that World Bank has proposed corporate taxes to stock broking business and Japanese Governments announcement to stop Aid with Pakistan facing the severest was not good news for the market.
We feel the market was ripe for a correction that has been witnessed today. We expect stocks to consolidate at current levels with continued interest in PPL, POL, NML and possibly some other side stocks such as JSCL and ANL. We maintain our positive view on the market and suggest to remain long in banks, PPL, POL, NML, ANL.
Source: Market Fails to Sustain 9,000 levels