KARACHI, May 24: Stocks on Wednesday rebounded from the recent lows on active short-covering at the blue chip counters aided by market talk that the next budget is expected to be more corporate-friendly, with a number of tax relieves for investors. The KSE 100-share index recovered another 184.39 points, adding Rs49 billion to the traded value.

Unconfirmed reports say a number of foreign investors are back in the market and are lifting oil and bank stocks at the current lower levels followed by strong financial support.

The market recovery was initiated by oil and bank shares aided by heavy buying at the attractively lower levels after investors digested the negative fallout of taxation-related rumours in the coming federal budget.

The KSE 100-share index breached through the barrier of 11,000 points at 11,116.88 as compared to 10,932.58 a day earlier, as all the leading base shares, including OGDC, Pakistan Petroleum, Pakistan Oilfields, National Bank and PTCL, recovered from the recent lows.

“I don’t think the budget-makers would go for new corporate taxes owing to election worries,” analysts said. “The next budget could be investor-friendly as far as Shaukat Aziz is the prime minister.”

That was perhaps why bears could sell the idea of new taxes in the national budget next month but in between managed to cover positions on the blue chip counters at massively cheap rates, they added.

OGDC at Rs145, National Bank at Rs248 and PTCL at Rs51 have, for instance, reached an attractive lower level, ensuring handsome capital gains for those who are inclined to take financial risks also.

Reports that the new management of PTCL plans to invest Rs20 billion next year to create more customer facilities could boost its share value from the current lows in the coming sessions, brokers predict.

As the budget is still about two weeks away, rumour-mongers could coin fresh bearish ideas making the CBR’s move to extend the tax net to some new areas, but bulls are said to be fully altered on this issue.

“Most of the leading oil, bank and cement shares are still in the buying range, as they are ruling well below their recent peak levels,” floor brokers said, adding: “Pre-budget boom based on some tax relief may be in the corner.”

Plus signs dominated the list under the lead of IGI Insurance and Rafhan Maize, up Rs15.75 and Rs40.80, respectively, followed by National Bank, Jahangir Siddiqui Fund, OGDC, Pakistan Petroleum, Indus Motors, Pakistan Services and Shell Gas, which posted gains ranging from Rs5.80 to Rs12.

Losses on the other hand were modest barring Ferozsons Lab and Nestle Pakistan, Lakson Tobacco, Shell Pakistan and Treet Corporation, which suffered fall ranging from Rs4 to Rs54.40.

Traded volume showed a modest rise but was still well below the daily average totalling 206.066m shares as compared to 123m shares a day earlier. Gainers topped losers by 197 to 100, with 44 shares holding on to the last levels.

OGDC topped the list of actives, higher by Rs5.85 at Rs154.50 on 59m shares, followed by National Bank, up Rs5.80 at Rs254.35 on 24m shares, Pakistan Petroleum, higher by Rs8.45 at Rs256.20 on 19m shares, DG Khan Cement, steady 75 paisa at Rs111.75 on 11m shares, Bank of Punjab, steady by Rs1.50 at Rs86.80 on 8m shares, and PTCL, firm by 20 paisa at Rs51.25 on 5m shares.

Other actives were led by Lucky Cement, firm by 30 paisa on 9m shares, Pakistan Oilfields, higher by Rs4.65 on 7m shares, MCB, up Rs2.20 also on 7m shares, and BSJS Fund, unchanged on 5m shares.

FORWARD COUNTER: OGDC was also actively traded on the cleared list, up by Rs5.01 at Rs154.01 on 11m shares, followed by Pakistan Petroleum, higher by Rs7.75 at Rs255.75 on 9m shares and OGDC, June settlement, up Rs5.05 at Rs154.00 on 8m shares.