Pakistan equities gained 223points to close up 2.4% on better than expected earnings and hopes of improving political climate as former Premier Nawaz Sharif (key opposition leader) meets President Zardari today. Moreover, grounds gained by army in the military operation against terrorist in South Waziristan were also cheered by the market. A flood of corporate announcements before the start of trading today kept interest alive in early trading. Much awaited JSCL PA result was one of the first announced with earnings keeping the stock steady closing +2%. MCB PA hit upper lock as investors continued to accumulate the stock after 9MCY09 earnings announced in late trading on Friday. Fauji Fertilizer FFC PA also announced nine month earnings that grew by over 23% and cash payout of PKR3/sh in line with market expectations with stock closing flat. United bank traded volatile ending the day up 2.3% despite below than expected results at EPS PKR6.2.
Upcoming visit by Sec of State Hilary Clinton and hints of possible announcement of US investment in Pakistan energy sector during her visit this month end are likely positives for oil and power stocks. Having said this, we feel overseas flows will continue to determine market direction in the short term. However, with very little excitement left in corporate earnings, market will be lacking major triggers, with some positives on the war on terror the unlikely cheer.
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