The Karachi stocks last week finished higher as investors covered their position on selected counters at current levels, aided largely by technical factors including the perception of capital gains.
Bulk of the support originated from financial institutions and the leading punters at the current lower levels. What seems to have boosted the market sentiment were reports that the government intends to e sell 26 per cent controlling shares of the Telecom giant, the Pakistan Telecommunication Company during the next six months.
Some leading bidders have already been short-listed and the remaining formalities leading to its partial sell off possibly by next March are expected to be completed in between.
"The PTCL-led rally is expected to be sustained during the post-Eid holiday sessions as its lower prices could attract a lot of fresh covering purchases by both the financial institutions and the punters", analyst said.
The KSE 100-share index breached through the barrier of 5,400 points after several abortive bids and is expected to tend further higher on the strength of the PTCL whose weightage is about 17 per cent and together with the OGDC, the PTCL, the Hub-Power and the PPL it is more than 50 per cent. It was finally quoted around 5,415.
The rally preceding a long weekend ahead owing to Eid holidays - as the market will now re-open on next Thursday - always signals a robust post-Eid holiday opening despite fears of opposition planned anti-government agitation.
The interesting feature was that there were no major instances of pre-holiday selling even from the weak holders owing partly to easing of badla rates, which in turn allowed bulls to have a field day despite late selling on some of the counters.
The weekend recovery, therefore, was further extended as leading base shares came in for renewed support at the still attractively lower levels under the lead of energy sector and finished with fresh gains.
The index may not jump up to its pre-reaction level of 5,620 just in one go but it is now pretty sure that it will continue its current upward drive after consolidating initial gains, analysts said adding" all the aiding factors to its upward journey are now in its favour and post-Eid holiday session could witness a major change in the market psychology".
Leading index shares including the OGDC, the PTCL, the PSO, and some others are now on the recovery path as the falling world oil prices and status quo on the local front could significantly add to their profits, they said.
Active short-covering in the oil marketing companies followed by reports of easing of world prices and official announcement not to increase local retail selling rates during the current month triggered fresh active support in the PSO, the Shell Pakistan and the refinery shares.
The other supporting positive factor was good news from the carryover market where badla rates have dropped into a single digit and so did investment from the high mark of below Rs25 billion, brokers said.
"Bush factor is still to manifest itself but after the end of the holy month, the possible chief beneficiaries of it are already bracing themselves for a big catch", said a leading analyst.
"I still hold the view that the KSE index could add another 200 to 300 points to its current levels if all goes well on the political fronts in the backdrop of opposition's threat of mass movement against the 17the constitutional amendment", he added.
Reports of an increase of 16 per cent in export during the last month, lower lint cotton prices could significantly add to the textile export during the current quarter ending December31, brokers said.
All economic indicators point to a robust share market in coming weeks sans the fresh galore of corporate announcements but healthy interim reports poring in daily could well form a strong base for future speculative buying on selected counters, they said.
Plus signs, therefore, again dominated the list, leading gainers being the Artistic Denim, Security Papers, Noon Pakistan, Al-Ghazi Tractors, Shezan International, National Refinery, and the Lakson Tobacco, Dawood Hercules, Crescent Steel.
Other good gainers were led by the Zulfiqar Industries, Millat Tractors, Shell Pakistan, ABAM Growth Fund (right), ICI Pakistan and Aventis. Losers were led by the Abbott Lab, Shakarganj Sugar, New Jubilee Insurance, the BOC Pakistan, and Atlas Honda, Unilever Pakistan and the Wyeth Pakistan, Treet Corporation, Rafhan Best foods, HinoPak Motors, Parke-Davis and several others.
FORWARD COUNTER: Speculative issues on the forward counter also followed the lead of their counterparts in the ready section and tended higher under the lead of the PTCL, followed by the PPL, Fauji Fertiliser Bin Qasim, the D.G. Khan Cement, Engro Chemical, the ICI Pakistan and Fauji Fertiliser.
