Equities remained weak throughout the day after Saturday's gory suicide bombings in Northern region threatening the recent peaceful environment. Besides, market seems to be wary of the recent FoDP meeting that failed to yield anything concrete except for the usual aid/support commitments, clearly indicating some influential friends are not comfortable with our Government. Oil stocks remained weak after international prices eased off sparking a sell off in oil stocks that are heavily weighted on the index, fuelling selling by locals, probably feeling they may buy back at lower prices. Another reason for today's sell off can be attributed to September quarter end profit taking by domestic institutions and probably taking advantage of lack of foreign activity today. Interestingly, the stocks to suffer most were the FII's favorites such as MCB, ENGRO, PSO and of course OGDC. The star performer remained JSCL which traded over USD15.4mn worth shares today indicating market is still very bullish in the holding company ahead of its 1QFY10 earnings.
We feel market will bounce back tomorrow ahead of the Central Bank's Monetary Policy where market is expecting 25-50bps rate cut, in line with the current trend being followed by the State Bank. Moreover, market is also expecting a possible cut in CRR and SLR, which will ease some liquidity in the banking system.
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