KARACHI: The market limped back on the path of recovery on Tuesday, nursing the wounds of the massive fall a day ago.
The KSE-100 index recouped 231 points (0.58 per cent) and closed at 39,863, after hitting the intra-day high of 389 points.
Traders and analysts fumbled for reasons of market’s return to the green despite no respite the in rising Covid-19 cases. Consistent increase in international oil prices; the political changes in the middle east, the start of transition process to the Biden government and a bit of a thaw in the political activities in the country combined to encourage investors to stay and pick up blue chips at dips.
Raza Jafri, Head of Equities at Intermarket Securities said that the market may have corrected itself as it had already receded from the 42,000 to below 40,000 points level. Besides, he said the investors took cue from rising global markets where hopes ran high after encouraging news about progress on Covid-19 vaccine.
A major market player thought that the market remained range bound due to low investor participation. The traded volume on Tuesday stood at 175 million shares, from 195m shares that changed hands a day ago.
He did not agree to a late reaction of the State Bank of Pakistan monetary policy when there was even no surprise in the announcement.
“The long-term value investors have thought discretion to be better part of valour and they have stepped aside,” he said and figured out that the entire market had turned day jobbers; they bought in small amounts and sought an exit after profit taking before the market closed for the day.
The figures released by the National Clearing Company of Pakistan Ltd showed foreign selling of $0.93m. Local participants bought and sold equity worth tiny amounts.
Exploration & production stocks gained. Banks and oil & gas marketing companies also traded positively. Cement sector saw selling pressure, which came on the back of anticipation of slow growth in cement dispatches due to winter. Steel and refinery sectors also saw some recovery. Major positive contributors to the index were Pakistan Oilfields Ltd, Dawood Hercules, Mari Petroleum, Lucky Cement and Oil and Gas Development Company.
Published in Dawn, November 25th, 2020