OUR STAFF REPORTER LAHORE Corporate results remained unable to stir the equity market sentiments, however the institutional interest in fertilizer scrips on higher local rates led short recovery at a volatile session of the local bourses. The market closed the week at 11,525 level, down 3.9 percent WoW. Average daily volumes shrank by 31 percent WoW to 86 million shares, while foreigners remained net sellers of $67 million. The continuing global crisis and stern messages from the US Secretary of State Hilary Clinton overshadowed the impressive corporate results. The exceptional results of the POL and ATRL posting a respective 55 percent and 53 percent rise in profits were unable to stir the market sentiments. Naveed Tehsin, a stock expert, observed that the Xenel Industries of Saudi Arabia (Co-founder of Hub Power) sold its 12 percent holding in Hub Power leading to a one off foreign outflow of $60 million. Moreover, Mr Yaseen Anwar was appointed as the governor of the SBP during the week. Ahsan Mehanti, another market expert, stated that bearish activity witnessed in scrips across the board as investors reacted to tough message to Pakistan by US Secretary of State to act with US led war on militants. Investors remained bearish throughout the trading session after lower than expected earnings announcement by National Refinery. Rumours dominated the market regarding resumption of gas supplies to fertilizer companies and favourable amendments in banking sector regulations regarding forced sales value. Foreign investment for 1QFY12 clocked in at $236 million in 1QFY12 (down 49 percent YoY), while current account deficit widened to $908 million in September 2011 (up 4.5x from last month). Moreover, textile exports during Sept were recorded at $982 million, down 10 percent MoM. The much awaited ground breaking of $12 billion Diamer-Bhasha dam project was laid by the Prime Minister during the week; however financing matters are still to be resolved. The cement sector is expected to be a major beneficiary from this project. Fertilizer sector remained in the limelight throughout the week as initial news reports suggested that gas supply to SNGPL network powered plants will remain suspended throughout the week. However, a ruling by the Sindh High Court came in later during the week which directed SNGPL to supply 100mmcfd gas to Engros new plant - speculating a downward revision in the urea prices. Hence, the sector came down by 5.1 percent during the week led by Engro and FFC, down 13.7 percent and 5.4 percent, respectively. National Refinery Limited (NRL) posted an earnings of Rs828.3 billion (Rs10.4 per share) in 1QFY12, showing a massive decline of 38 percent as compared to Rs1.3 billion (Rs16.9 per share) the same period last year. The major culprit behind this significant decline is the fuel segment which suffered on account of inventory losses. Though still waiting for the detail accounts, fuel segment is likely to post a loss of Rs300 million (Rs3.7 per share) as against a profit of Rs236.9 billion (Rs2.9 per share). Subject to detail accounts, companys lube earnings would be some where around Rs1.1 billion (Rs14) a slight improvement from same period last year but significantly lower by 36 percent from proceeding quarter. Overall gross margin during 1QFY12 stood at 4 percent compared to 7 percent similar period last year, down by 300bps. Experts said that as the market maintained the previous session low of 11,565 a break of the same would indicate resumption of the corrective trend. Should this take place next most important support level stands at 11,456 i.e. the 50 day moving average. On the contrary, resistance is presently defined by 20 day average at 11,800. Having said that, the prices of a few stocks have approached their maximum supports and the scenario offers a trading opportunity with lowest risk. MCB Bank (MCB) is scheduled to announce its 9MCY11E earnings on Monday, October 24, 2011. Growth in earning assets is likely to drive 26 percent YoY growth in NII during 9MCY11 with NIMs at 8.45 percent for the quarter (-10bps QoQ and +13bps YoY). Experts project the bank to post PAT of Rs16,130 million (EPS: Rs19.29); recording a YoY growth of 29 percent. For 3QCY11E, it is expected the company to post PAT of Rs5,559 million (EPS: Rs6.65); indicating a growth of 22 percent on a YoY basis. Bank AlFalah (BAFL) is scheduled to announce its 9MCY11E earnings also on Monday, October 24, 2011. It is expected the earnings momentum in 9MCY11 to be largely driven by a robust 33 percent YoY growth in Net Interest Income (NII). Similarly, 3QCY11E NII is also expected to be 21 percent higher YoY. Experts project the bank to post PAT of Rs2,945 million (EPS: Rs2.18); recording an astounding YoY growth of 96 percent. For 3QCY11E, it is expected the company to post PAT of Rs1,037 million (EPS: Rs0.77); indicating a growth of 145 percent on a YoY basis. It is expected Fauji Fertilizer Bin Qasim (FFBL) to post PAT of Rs6,624 million (EPS: Rs7.09) for 9MCY11 compared to PAT of Rs2,931 million (EPS: Rs3.14) for 9MCY10 in its result announcement on October 25, 2011. Pakistan Petroleum Limited (PPL) is scheduled to announce its 1QFY12 result on Monday, October 24, 2011. During 1QFY12, it is expected net sales and PAT for PPL to increase by 24 percent and 25 percent respectively on the back of 1) 5 percent and 12 percent YoY increase in average well-head gas prices and gas production respectively, and 2) 11 percent and 47 percent YoY increase in oil production and oil prices respectively during the period.