KARACHI: There was no let-up in the bull run at the market for sixth week in succession. The KSE-100 index piled up 1,445 points (3.7 per cent) and settled at 40,732, breaching the psychological 40,000-level for the first time in nine months.

Investors’ exuberance — particularly that of the individuals — was fuelled by the banking sector which got a favourable review from Moody’s that raised the outlook on Pakistan banks from “Negative” to “Stable”. It was followed by up-gradation of outlook to “stable” for the big five banks, spurring buying activity in the sector.

With nothing exciting on the political front, the investors’ interest remained centred on the economic indicators. Trade deficit contracted once again by 35pc during November; consolidation of total reserves continued, as SBP dollar stocks touched eight-month high of $9.1 billion; and tax collection continued to increase in double digits (17pc). More comfort to the market was provided by the recent net inflow of $431 million and potential inflows of $239m and $1.3bn from China Mobile and Asian Development Bank, which analysts expect to offset the $1bn Sukuk payments made in the preceding week.

Foreigners turned buyers in the week clocking in at $1.1m compared to a net sell of $8.1m the previous one. Inflow was witnessed in fertiliser at $8.4m and oil and gas marketing companies $2.2m. On the domestic front, major buyers were individuals $20m and mutual funds $7m while banks at $22m and other organisations $3m opted to book gains.

Healthy participation by investors raised the average traded volume to 465m, up 34pc, and close to the 30-month high of 557m shares in a single day, while the mean value amounted to $105m - higher by 31pc.

Encouraging news flows in the energy sector also supported the ongoing rally as the government and independent power producers reached an agreement on the prolonged dispute on circular debt with the energy minister stating that the circular debt accumulation had declined to Rs11bn per month, from Rs40bn.

Sector-wise positive contributions came from commercial banks at 645 points, oil and gas marketing 131 points, power generation and distribution 97 points, exploration and production 84 points and insurance 79 points. Among scrips, gains were led by Habib Bank, increasing by 155 points, MCB 144 points, United 87 points, Bank Alfalah 78 points and Hub Power 75 points.

Going forward, most market pundits visualise the rally to continue, albeit at a slower momentum due to already a massive rise in the last five months. Major triggers in the upcoming week include continuous improvement in the macro indicators and the eerie silence on the political front. Furthermore, net purchases by foreigners has raised hopes of more inflows in the equity market as the overseas investors would not want to be seen as missing out.

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