KARACHI, Sept 16: Stocks on Thursday staged a snap recovery as investors covered short positions at the lower levels aided by reports that a high-powered delegation of the KSE will meet the prime minister soon to apprise him about the negative fall-out of the Capital Value Tax on the share trading and seek a waiver.

The market capital soared by Rs90 billion at Rs1,436.014 billion after the shifting of massively-capitalized Pakistan Petroleum to the ready board from the forward counter.

President Musharraf's decision not to hang up the uniform and to hold both the posts of President and Chief of the Army Staff was another aiding positive factor on the perception of continuity in the economic and financial policies initiated by him for the next five years, brokers said.

There are more than one reasons to sustain the current run-up on technical grounds alone, brokers said adding any positive official word on the CVT could lead the market to its past glory.

The KSE 100-share index, which had breached through the barrier of 5,000, signalling the possible crash of the market, rebounded and finished with a smart recovery of 57.68 points at 5,055.03 as compared to 4,997.35 a day earlier as all the leading base shares managed to close partially recovered.

"The index has fallen by 350 points showing a silent investor protest against the levy of CVT," brokers said adding "a virtual crash below the index level of 5,000 was imminent if the KSE has not decided to talk to the prime minister on its negative fall-out".

There may not be a total waiver but there could be some relief on this count in the form of a cut in the rate and then a gradual withdrawal. The CVT was imposed at the rate of 0.01 per cent and withholding tax at the rate of 0.05 per cent of share transactions in the national budget in June.

The perception that the prime minister being more friendly with the high-ups of the bourses and investors at large will certainly act on the advice of the high-powered KSE delegation and may announce an immediate relief on this count. And this perception lured investors back in the market.

During the last two weeks persistent sell-off, some of the leading shares were in oversold position and attracted a lot of support at the attractively lower level.

All the sectors participated in the run-up under the lead of energy, banking, telecom, cement and leading shares on the other counters and finished partially recovered.

Leading gainers were led by Gatron Industries, Pak-Suzuki Motors, Central Insurance, Dawood Lawrencepur, Berger Paints, Colgate Pakistan and Atlas Honda, which recovered Rs3.40 to Rs10.

Losers were led by Treet Corporation, Arif Habib Securities, and Nestle MilkPak, which suffered fall ranging from Rs10 to Rs23.10 followed by Gillette Pakistan, Wyeth Pakistan, Siemens Pakistan, Lakson Tobacco and Pakistan Refinery, off Rs3 to Rs6.05.

Trading volume rose to 237m shares from the previous 191m shares as gainers forced a strong lead over the losers at 198 to 95, with 41 shares holding on to the last levels.

Pakistan Petroleum, which was shifted from the forward counter to the ready section led the list of actives, up by Rs1.45 at Rs109.95 on 49m shares followed by OGDC, higher by Rs1.55 at Rs60.65 on 38m shares, D.G.Khan Cement, firm by 65 paisa at Rs54.85 on 23m shares, PTCL, steady by 35 paisa at Rs38.75 on 13m shares, Bank of Punjab, higher by Rs1.20 at Rs64.70 on 12m shares, Hub-Power, up By 35 paisa at Rs31.55 also on 12m shares and National Bank, higher by 70 paisa at Rs68.30 on 8m shares.

Other actives were led by Fauji Fertilizer Bin Qasim, up by 55 paisa on 8m shares, Chakwal Cement, lower 10 paisa on 7m shares and Lucky Cement, higher by 55 paisa also on 7m shares.

FORWARD COUNTER: In sympathy with return of the bulls in the ready section, speculative issues on the forward counter also showed strong rallies under the lead of OGDC, up by Rs1.50 at Rs60.80 on 13m shares followed by D.G.Khan Cement, firm by 40 paisa at Rs54.80 on 7m shares, PTCL, easy 15 paisa at 38.35 on 6m shares, National Bank, up by 75 paisa at Rs68.55 on 2m shares and Fauji Fertilizer Bin Qasim, higher by 50 paisa at Rs19.85 also on 2m shares.