THE share market showed an improved performance during the preceding week as a combination of positive news both on the political and corporate fronts continued to inspire fresh covering purchases and speculative buying on selected counters.
The major breakthrough came after the advent of foreign buying, which local investors thought was based on some positive news on the political front and followed it, notably in the banking and oil sectors.
The KSE 100-share index firmly settled above its psychological barrier of 15,000 points and analysts said the current attempt may not prove abortive and it may set new records in the coming weeks.
The KSE 100-share index was last quoted at 15,085.18 as compared with the previous week’s 14,934.3, up by 150.88 points as leading base shares rose from the previous lows. The 30-share free index also rose by 239.9 points at 18,607.19.
Over the last week, it shrugged off the last couple of weeks erratic movements below or above the barrier but the current breakthrough may well prove final and it could seek a level well above 15,000 points.
Revival of foreign buying during the post-election trading sessions reflects that leading fund managers may have found the cue about political stability after the coalition set up in the centre is in place, floor brokers said.
The daily rising volume well above 300 million share mark after mid-week indicates there is enough money around after the entry of foreign buying despite the fact the CFS ceiling remained choked at Rs55 billion, they said.
The task before the new government may be enormous, but they have the will and resolve to come to the expectations of their voters to put the economy back on the rails and chain the monster of inflation, they said.
Stocks staged a snap rally on strong short-covering at the lower levels aided chiefly by analyst predictions of higher profitability of the banking sector and oil during the current fiscal.
“Essentially, it appears to be a MCB led-rally judiciously aided by foreign fund buying, which has been under pressure for the last couple of sessions amid confusion of client selling”, said a leading stock analyst Ahsan Mehanti. “But once the issue is settled it was back on the track”, he added.
Another leading analyst Faisal A. Rajabali predicted it was a judicious blend of both local and foreign buying and could be sustained during the coming sessions also as “only fools would miss the bait of massive capital gains at the current levels”.
However, the quantum of foreign buying and the selected counters on which it figured heavily was not immediately known , he said.
MCB, which has the largest weightage (11per cent in the index) has at one stage during the last couple of sessions dropped below the barrier of Rs400 but on Wednesday finished with an extended gain of Rs12 at Rs420.90.
Other leading banks, mainly National Bank, and Bank Alfalah and leading oil and cement shares followed them under the lead of PSO, OGDC, Lucky Cement, D.G. Khan Cement and PTCL.
Although the index finished below its week’s high on late selling in some of the leading base shares, indications are that it will stay above the barrier of 15,000 during the next couple of sessions.
But on the other hand the KSE 30-share free float index showed a much bigger gain on the strength of leading base shares.
Apart from analyst predictions of higher profits by the major sectors during the current fiscal, some positive developments on the political front, notably formation of governments at the centre and the provinces was said to another supporting factor, analyst Ashraf Zakaria said.
The market performance in the backdrop of successive suicide attacks and bomb blasts during the last couple of weeks reflects that investors seem to be in no mood to consider them a negative market factor and resume normal trading activity, of course, after initial shocks and grief on the loss of innocent lives, he added.
Forward counter: Speculative issues on the cleared list also performed well in sympathy with their counterparts on the ready counter and generally ended with good gains. OGDC, Pakistan petroleum, Pakistan Oilfields, MCB, National Bank, Lucky Cement, Habib Bank, Fertiliser Bin Qasim, Bank Alfalah, Engro Chemical, and PSO were leading gainers among them.
THE share market showed an improved performance during the preceding week as a combination of positive news both on the political and corporate fronts continued to inspire fresh covering purchases and speculative buying on selected counters.
