Stocks, overnight rates end flat; rupee weakens

Pakistani stocks ended flat on Friday with early gains wiped out after Engro Corp reported lower-than-expected results for the first half of 2011, dealers said

Engro Corp reported a net profit of 3.32 billion rupees ($38.45 million) in the first half of 2011, compared with 3.2 billion rupees in the same period last year. The earning per share was 8.64 rupees.

"The result is well below our expectation of 10.8 rupees per share mainly on account of lower earnings of its fertilizer business," said Bilal Qamar, an analyst at JS Global Capital
Ltd. Engro closed 2.86 percent lower at 131.89 rupees. "Engro Corp's lower-than-expected result forced its share price lower by four rupees," said Samar Iqbal, a dealer at
Topline Securities Ltd.

The Karachi Stock Exchange's benchmark 100-share index closed 0.03 percent, or 2.91 points, lower at 11,262.04 points on turnover of 53.87 million shares. The KSE-index hit an
intra-day high of 11,410.74 points.

In the currency market, the rupee ended weaker at 86.39/45 to the dollar, compared with Thursday's close of 86.30/36, amid higher import payments.

Dealers said the rupee is likely to stay range-bound in the coming days because of higher remittances from overseas Pakistanis. According to official data, remittances rose 38.57 percent to $1.1 billion in the first month of 2011/12 fiscal year, compared with $791.18 million in the same period last year. In the money market, overnight rates were flat at 13.40 percent, unchanged from the previous day's close amid tight liquidity in the interbank market.

Dealers said there could be unscheduled outflows of 30 billion rupees ($347.5 million) on Monday.