May 18, 2006	Thursday	Rabi-us-Sani 19, 1427

KARACHI, May 17: Stocks on Wednesday were back on the rails as investors covered positions at the attractively lower levels in bank, oil and cement shares, pushing the KSE 100-share index higher by 387.45 points or 3.62 per cent at 11,094.41.

Led by the financial institutions the rally was terribly broad-based as investors were out to avenge the massive battering they received during the last two sessions but sellers remained conspicuous by their absence anticipating the continuation of the technical run-up in the sessions to come also.

The snap rally demonstrated that there is nothing basically wrong with market fundamentals, some speculative forces tilt the balance in their favour after spreading conflicting rumours to create panic among the small investors, leading to hasty unloading by them.

After having shed 800 points or seven per cent during the last two sessions followed by negative rumours, the KSE 100-share index recovered about a half the total loss on the strength of leading base shares including OGDC, PTCL, National Bank and Pakistan Petroleum.

It finished the session at 11,094.41, up 387.45 points or 3.62 per cent as compared to 10,706.96 a day earlier and analysts said the breach of the crucial level of 11,000 points signals that the worst is over. Market capital also recovered Rs103.795bn at Rs3,124.218bn.

“The sell-off triggered by some big ones was based on rumours rather than any negative fall-out of the corporate or political developments,” analysts said “The bears chose it to scare small savers after having spread rumours about the CFS episode and a rumoured financial scam.”

A terribly broad recovery just at the heels of terrifying panic allayed investors’ fears that the overbought market could fall to any lows in the subsequent sessions despite the fact that it is still in an oversold position.

“The massive outflow of money to gold and other speculative trades is progressively inching back and there is no reason to believe that the market has reached the saturation point as far as it upward thrust is concerned,” most brokers believe.

Most of the blue chips did rise as they did fall during the last two sessions with upper locks in most of them. Pakistan Oilfields, National Bank, MCB and Pakistan Petroleum, for instance, rose by Rs10 to 20 but all of them still to go a long way to attain their pre-reaction levels.

The rally was initiated by heavy buying in bank, and leading oil shares followed by cement, on reports that the import of cement may be banned, and leading shares on the other counters.

Top gainers included Arif Habib Securities and Nestle Pakistan, up Rs26.50 and 48, followed by National Refinery, MCB, National Bank, Pakistan Hotels, Millat Tractors, Unilever Pakistan, Pakistan Petroleum, Attock Petroleum, Colgate Pakistan and Shell Pakistan, which posted gains ranging from Rs8.50 to 24.25.

Losers were led by Grays of Cambridge and National Foods, off Rs12.30 and 6.15. Others fell modestly under the lead of Shaheen Insurance, AKD Securities, Pakistan Cables, Ghandhara Industries, Gatron Industries and Dawood Hercules, off Rs2.50 to 5.

Trading volume showed a modest rise at 236m shares as compared to 220m shares a day earlier but gainers forced a strong lead over the losers at 267 to 70, with 33 shares holding on to the last levels.

OGDC came in for active support and rose by Rs6.20 at Rs151.20 on 33m shares followed by National Bank, sharply higher by Rs12.25 at Rs257.85 on 25m shares, PTCL, firm by 95 paisa at Rs52.80 on 18m shares, Lucky Cement, up Rs5.60 at Rs117.65 on 14m shares, Pakistan Petroleum, higher by Rs10.30 at Rs254.90 on 13m shares, MCB, up Rs11.35 at Rs239.25 also on 13m shares and Pakistan Oilfields, higher by Rs19.95 at Rs419.25 on 8m shares.

They were followed by D.G. Khan Cement, higher by Rs5.35 on 13m shares, Fauji Fertiliser Bin Qasim, up Rs1.35 on 9m shares and Fauji Cement, firm by Rs1.05 on 8m shares. There were some other actives also.

FORWARD COUNTER: NBP led the list of actives on this counter, higher by Rs11.70 at Rs258.45 on 18m shares, followed by OGDC, up Rs5.35 at Rs151.60 on 16m shares and Pakistan Petroleum, firm by Rs10.30 at Rs255.80 on 11m shares.

Other actives included Pakistan Oilfields, higher by Rs19.70 at Rs420 on 9m shares and MCB, up Rs11.30 at Rs240.60 on 8m shares.

DEFAULTER COS: Crescent-Standard Bank came in for fresh selling and was marked down by another 50 paisa at Rs4 on 0.640m shares, while others rose modestly on stray support.