January 16, 2003	Thursday	Ziqa'ad 12, 1423

KARACHI, Jan 15: The KSE 100-share index on Wednesday soared by 3.52 per cent or 100 points and settled firmly above the barrier of 2,900 points followed by massive short-covering in pivotals triggered by rumours of some more tax exemptions for those foreign investors who invest in local shares.

Both the breach through the psychological barrier of 2,900 points and a massive increase of about Rs20 billion in the market capitalization at a record high of Rs645 billion is considered an attractive bait for any foreign investor, notably in shares such as PTCL, Hub-Power and Sui Northern Gas at their current levels.

“More tax incentives may not open the flood-gate for foreign funds as they link their entry to any market having a depth of over $20bn (KSE’s current market capitalization being slightly above $11bn) but will certainly add to the investor confidence”, hopes a leading stock analyst.

An idea of price flare-up may well be had from the fact that there was a virtual scramble on all the blue chips counters where individual shares, notably in the energy sector are racing toward their new career-best levels.

The net rise in the index was of the order of 100.22 points at 2,950.29 as the volume figure soared to 591m shares, with most of the leading shares breaching through their upward circuit breakers both in the ready and forward counters.

“The next target of 3,000 points is now just one shot away”, one broker said “analysts are now talking of the index level of 3,200 points and for good reasons too”.

After last two days’ interruption, all roads again led to the stock market as no one was in a mood to miss the rising market and an attractive bait of capital gains.

The reports that the government is considering tax exemption for foreign investors in local shares and free repatriation of profits again lured investors back in the market who were thinking of fresh pruning after indulging in heavy selling.

“But the perception that the strong presence of foreign funds in the already bullish market could give it the needed depth generated a lot of local short-covering by the punters and genuine investors”, analysts said.

All the leading shares, notably in the energy sector remained the bone of contention throughout the session and finished with smart gains under the lead of Shell Pakistan, which soared by Rs18 at Rs461 (face value Rs10).

“Huge amounts of money originating from overseas Pakistan and local banks is flooding the share business and no one could precisely predict at this stage where the end will come”, brokers said.

Opinions are, however, still divided over the persistent bull run as some say it is not backed by the objective economic conditions and appears to be “inspired”. But some others claim it is genuine and reflects the strong presence of financial money, which is not finding profitable outlets in the corporate sector.

Plus signs dominated the list under the lead of Attock Refinery, Pakistan Refinery, Dawood Hercules and Unilever Pakistan, which posted gains ranging from Rs7.50 to Rs60. They were followed by Adamjee Insurance, New Jubilee Insurance, Fazal Textiles, National Refinery, Pakistan Oilfields, PSO, General Tyre, Packages, Suzuki Motors, and Shell Pakistan, which posted gains ranging from Rs3 to Rs18.

Losers were led by Sapphire Fibre, Abbott Lab, Nestle MilkPak, Millat Tractors and Pakistan Reinsurance Co, off Rs1.40 to Rs6.85.

Traded volume soared to 591m shares from the previous 389m shares as the advancing shares extended their lead over the losing ones at 261 to 43 and as many holding on to the last levels.

Hub-Power proved to be the most active scrip, higher by Rs1.45 at Rs42.05 on 159m shares followed by Sui Northern Gas, up by Rs1.85 at Rs26.65 on 94m shares, PTCL, higher one rupee at Rs26.25 on 90m shares, National Bank, firm by Rs1.15 at Rs30.35 on 37m shares and Dewan Salam, up by Rs1.50 at Rs16.95 on 29m shares.

Other actives were led by PSO, higher by Rs4.50 on 24m shares, Fauji Fertilizer, up by Rs2.75 on 15m shares, Engro Chemical, higher by Rs2 on 13m shares, D.G.Khan Cement, firm by 65 paisa on 12m shares and ICI Pakistan, higher by Rs2.25 also on 12m shares.

FORWARD COUNTER: All the speculative shares finished with sharp gains under the lead of PSO, which rose by Rs4.25 at Rs241.75 on 6m shares followed by ICI Pakistan, Fauji Fertilizer and Engro Chemical, up by Rs2 to Rs2.50.

Hub-Power was again the volume leader, up by Rs1.20 at Rs42.35 on 20m shares followed by PTCL, higher by 95 paisa at Rs26.45 on 11m shares and Sui Northern, up by Rs1.85 at Rs26.85 on 9m shares.

DEFAULTER COMPANIES: Schon Modaraba again came in for active support and rose by five paisa at Rs1.05 on 50,00 shares, followed by Suzuki Motorcycles, higher by 50 paisa at Rs8.55 on 27,000 shares and Medi Glass, firm by 10 paisa at Re1 on 22,500 shares.