KARACHI: Stocks extended rally on Monday with the KSE-100 index up by 480.47 points or 1.55 per cent to close at 31,491.62.

The market, which had started to rebound in the last two days of the previous week, saw further acceleration in gains as several positive factors helped boost investor interest.

The growing optimism over the settlement of disputes between the two major political parties dissipating immediate threat to the government; the receipt of $1.05 billion from the In­­ternational Monetary Fund and slight rebound in oil prices, all helped to pull in­­vestors back to the market.

Institutional investors also indulged in cherry-picking ahead of the earnings season. The major factor that encouraged investors’ was also the return of foreign investors who bought stocks worth $3.69 million on Monday.

Investors also took heart from the recovery in global equity markets as the US stocks rose after S&P 500’s best two-day streak in years and European shares ended higher on Monday. Asian equities were up, as investors cheered the Federal Reserve’s pledge not to increase interest rates.

Turnover rose 29pc on Monday to 182m shares, from 141m shares traded the previous Friday.

Traded value also rose 18pc to Rs10.5bn, from Rs8.9bn. Electricity sector remained in the spotlight with business in 36m shares followed by banking sector 31m shares.

Samar Iqbal, AVP equity sales at Topline Securities said that institutional activity was seen in index heavy weight oil and gas sector where renewed interest in POL helped it gain 5pc amid expectation of handsome dividend for Oct-Dec quarter.

Analyst Ahsan Mehanti at Arif Habib Limited commented that the stocks closed bullish ahead of year end close led by selected stocks across the board on improved economic and political outlook.

Published in Dawn December 23th , 2014