KARACHI, May 29: Heavy short-covering in Hub-Power on Wednesday took the entire market along with it into the plus column after a highly erratic early performance aided by hopes that the current international peace offensive may defuse the border tension. The KSE 100-share index recovered 27 points at 1,699.94.

The mid-session sell-off was attributed partly to conflicting negative rumours about the border situation and partly to negative Indian reaction to the president’s speech, which added to the war fears.

The market sentiment in part was also aided by the perception, shared by many leading analysts, that strong presence of the American soldier and other army rank may not allow India to launch offensive. Hence, the market will remain range-bound at least for the near-term.

“The shuttle diplomacy is at its peak as foreign ministers of various countries including Russia and Britain have visited Islamabad and had detailed talks with the president on the issue of cross-border infiltration,” stock analysts said adding “some more are due to win peace in the region.”

The general perception is that the immediate danger of war has been averted thanks to big power intervention, and brokers did not see any harm to play on short-term basis.

The Hub-Power was flooded with buystops at the current lower levels and in turn it took the entire market along with it in the plus column after evoking sympathetic buying on the other safe counters.

Many leading analysts claim the advent of foreign buying in Hub-Power could well mean that the Indo-Pak war may not be around at least for the next couple of weeks.

“The Tuesday’s decline was over-reaction to the president’s tough speech,” one broker said. “The advent of selective institutional support on the blue chip counters lured general investors in the rings.”

The highly volatile movements of the index, however, reflects that investors are unsure about the war, although international peace efforts have given them a breathing space to readjust their portfolio investment.

After early rising by 30 points, it later fell by the same amount but again rose to close higher by 27 points aided largely by massive short-covering in Hub-Power.

Big gainers were led by Siemens Pakistan, Engro Chemical, Shell Pakistan, Lever Brothers and Wyeth Pakistan, which posted gains ranging from Rs.3 to Rs.30. Other good gainers were led by Husein Industries, Noon Sugar, National Refinery, Pakistan Oilfields, Sapphire Fibres, Javed Omer and Tri-Pack Films, which posted gains ranging from Rs.1.05 to 2.90.

Losses were mostly fractional barring Shafiq Textiles, Mari Gas, Gadoon Textiles, Bata Pakistan and Security Papers, off 70 paisa to Rs.1.55.

Trading volume rose to 156m shares from the previous 35m shares as gainers held a strong lead over the losers at 151 to 84, with 32 shares holding on to the last levels.

The most active list was topped by Hub-Power, up Rs.1.10 at Rs.23.35 on 64m shares followed by PTCL, easy five paisa at Rs.16.05 on 39m shares, Sui Northern Gas, higher 95 paisa at Rs.13.60 on 13m shares, PSO, firm by 20 paisa at Rs.134.10 also on 13m shares and KESC, higher 35 paisa at Rs.5.05 on 8m shares.

Other actives were led by FFC-Jordan Fertilizer, up 25 paisa on 4.228m shares, Engro Chemical, higher Rs.4.15 also on 4m shares, Pak PTA, steady 20 paisa on 2m shares, and ICI Pakistan, higher 25 paisa on 1.230m shares.

FUTURE CONTRACTS: Engro Chemical and PSO came in for strong speculative support at the lower levels and finished with smart gains ranging from Rs.3.65 to 4.90 at Rs.60.85 to 134.70 respectively on large turnovers. Others also rose modestly amid active trading.