KARACHI, Aug 5: Equity Market Opportunity Fund (EMOF) came to the rescue of the stock market on Tuesday, after all other planks plastered by the regulators crashed under the weight of the market fall which had witnessed the KSE-100 index dip to below 10,000 points on Monday, the lowest in two years.

But at the close of a hectic trading day on Tuesday, the KSE closed with a gain of 2 per cent or 189 points, pushing the index back to above the 10,000 level and enabling the market participants to breath easy.

Traders said that sensing the market mood, the board had delayed opening of the market for 75 minutes on Tuesday during which ideas from brilliant to bizarre were discussed in the board room; the apex regulator Securities and Exchange Commission of Pakistan participated in the deliberations and a frantic call was made to Finance Minister Naveed Qamar.

The minister assured that the EMOF would “continue to perform its role in the market”. That was considered to be an encouraging enough signal, allowing the start of trade.

The KSE-100 index was down 296 points till mid-day. It would be churlish to assume that the market momentum was sparked by a piece of news such as the upward revision of well-head gas prices.

“Political and economic worries continued to linger with a make-or-break meeting between the coalition partners in the government, later in the day”, said an equity trader. So what made the market take a sudden turnaround?

Most participants agreed that it was the Equity Market Opportunity Fund (EMOF) managed by the National Investment Trust, which had utilised a big chunk of Rs20 billion under its management to purchase value stocks at lower locks.

NIT Chairman and Managing Director Tariq Iqbal Khan told Dawn that the Fund had bought stocks because it saw ‘opportunity’ of making gains for the contributors of Fund. He said that mandate had been sought from relevant participants for seizing the opportunity.

“We have enough resources to purchase eligible liquid stocks tomorrow and day after,” said the EMOF manager. Mr Tariq also reminded that NIT held Rs80 billion under its management.

The collateral benefit of operation of the EMOF was the stabilisation and support to the market. The chairman NIT and EMOF said he believed that the market should be left to function in a normal manner without taking any artificial measures that could trigger more fear, resulting in creating negative sentiments in the market.

But for all that, market pundits looked thoughtful if one man or one fund could support the Rs3-trillion stock market for long. For their obvious collective benefit, the market participants were putting up joint efforts on Tuesday to boost investor sentiments and show them the brighter side of the country’s economic and political picture.

“Stocks cannot be trading at more attractive valuations,” said an analyst. He could be talking sense for having dipped by 53 per cent (38pc index fall plus cost of borrowings) in less than four months, most blue chip stocks were available at dirt cheap prices of 6 times the forward earnings compared to 16 times a few months ago.