January 28, 2002	Monday	Ziqa’ad 13, 1422

The previous buying euphoria was further extended on the stock market during last week, as both local and foreign support did not allow the bears to tilt the balance in their favour.

The perception of a robust economy in the wake of changing financial scenario and the steady inflow of investment and the dividend-related covering purchases, ahead of board meetings of some leading shares, including the Engro Chemical, the PSO and some others continued to inspire speculative buying in a broad-based rally.

The important thing is that the run-up is not speculative but genuine backed up by strong basic fundamentals and perception of economic prosperity in the years to come, thanks to steady inflow of foreign funds.

An idea of buying flurry may well be had from the fact that the investors digested the bad news of Agni-test fired by India — capable of carrying nuclear warheads — and did not look back after the index crossed the 1,500 level.

The KSE 100-share index attained the coveted level of 1,500 points after about a year’s abortive attempts and as the developing economic outlook and financial scenario signals it could be not only be sustained but can be improved.

“There are more positive news than the negative. Investors await the troops pull out from the borders to accentuate the current bull-run”, says a member of the KSE.

“Its next immediate target could be 1,700 index level”, he predicts, adding if all goes well it could surpass the previous all-time figure of 2,662-point established in 1994 as the current boom-like conditions are backed by most encouraging financial background news”.

It finally ended around 1,527.00 adding another Rs10 billion to the market capitalization, the total during the last two week being Rs40 billion at Rs348 billion. The net index rise was 48 points or three per cent, the two weeks tally being 11 per cent.

It was a judicious blend of both local institutional and foreign buying, although bulk of it remained confined to the Hubco, the PTCL and some other blue chips including the ICI Pakistan.

Investors virtually flooded the market on the perception that the cut in discount rate from 10 to nine per cent could well mean cheaper funds for investment both for corporate and industrial sectors adding to the manoeuvring power of those who are in share business. “It was a classic move by the State bank to add its bit to the developing economic scenario and strong basic fundamentals”, stock analysts at the W.E.Financials commenting on the one per cent cut in discount rate said, appending “easy supply of funds at cheaper rates could add to the prevailing buying euphoria in coming weeks”.

The impact of the rate cut and some other bullish economic indicators was so strong that the market was not inclined to entertain bearish impact of the fall-out of Kalkota firing incident.

It was a remarkable performance judged by any standard including the news from the border where tension is claimed at the highest pitch as the market chose