KARACHI: Bulls went on a rampage on the stock market on Wednesday with the KSE-100 index hitting the top this year at 9,836.50 points, adding another 193.39 points or 2.01 per cent.

Traders said that the index closing near the highest for the day and the growing volume suggested that the current strong rally was far from over. Some analysts were revising their fair value estimates for the stocks given the investors appetite for more.

Same as the day earlier, buying was dominated by the local funds and foreign investors. Net buying by local funds stood at $10.4 million and that by foreign investors amounted to $7.3 million. Local individual investors were net sellers of $12.7 million worth of shares and local companies also offloaded stocks in the sum of $5 million.

Many market participants explained the bullish fervour at the KSE in the global context. ‘Given the huge inflow of dollars in the emerging markets, some of it was trickling into the Pakistani bourse,’ said one analyst. And he added that the lower price multiples and high yield of stocks were sufficiently enticing. The result season for 1Q10, which is to start soon, increased investor interest in equity trading.

The KSE board’s decision of recommending two leverage systems to the Securities and Exchange Commission of Pakistan (SECP), namely the Margin Financing System and the Margin Trading System was seen to give a big boost to the market as the step was expected to considerably fatten the volumes, a market participant said.

In the heat of the moment, investors totally ignored the internal issues of law and order and the uncertainty surrounding the outcome of Kerry-Lugar bill.

On Wednesday, the volume of business shot up by 28 per cent to 341 million shares, from 266 million shares traded the day earlier. A total of 436 listed scrips came in for trading. Of those 246 closed in the plus column, 174 in minus and 16 remained unchanged. Market capitalisation of all equities increased by 2.1 per cent to Rs2,854 billion, from Rs2,795 billion on Tuesday.

The two stocks that showed the highest gains on Wednesday were Wyeth Pakistan that rose by Rs53 to close at Rs1,385 and Rafhan Maize Products added Rs51.75 to Rs1,602.

Stocks which stood out as market leaders in terms of volume were led by Bank Alfalah, which rose by 52 paisa to Rs14.10 on 38.2 million shares. On the second place was Jah.Sidd.Co, which shed one paisa to Rs39.99 on 22.7 million shares.

Lucky Cement gained Rs4.01 to close at Rs84.26 with trading in 17.7 million shares. Arif Habib Sec posted gain of Rs1.61 to finish at Rs43.75 on 14.7 million shares. NBP was strong on the commercial banks sector, rising by Rs2.78 to Rs87.17 on 14.5 million shares.

D.G.K Cement, the second of the two largest cement producers, saw its scrip rise by 50 paisa to Rs35.75 on 14.3 million shares. NIB Bank gained 12 paisa to Rs5.66 on 13.6 million shares.

The index-heavyweight OGDC gained another Rs2.40 on Wednesday to close at Rs113.76 on 13.4 million shares. Lafarge Pakistan edged up by 23 paisa to Rs3.08 on trading in 9.1 million shares. The fertiliser giant, Engro Chemical remained under pressure to shed Rs2.21 to Rs178.48 on 9.1 million shares.

Future Contracts

On Wednesday, the October contracts showed biggest volume of 0.600 million shares in Bank Alfalah, which gained 52 paisa to close at Rs14.14. NBP saw volume of 0.321 million shares to close Rs2.74 up to Rs86.99.