KARACHI, June 15: The KSE 100-share index on Thursday staged a massive recovery of 410.48 points or 4.68 per cent on active short-covering aided by downward revision of the exit mechanism but sceptism about the market’s future direction remained a dominant negative psychological factor.

It finally finished at the session’s peak level of 9,177.46 points adding Rs112.353 billion to the market capital at Rs2,593.333 billion.

What seems to have lured investors both punters and institutional traders was the downward revision of exit mechanism from the exiting 20 per cent to five per cent outwitting the bears and apparently restored sanity in stock trading.

“The index should have recovered 820 points, which could have been the biggest single-session gain if the upper lock would have been 10 per cent,” says a leading stock analyst adding: “The finish of the index at the day’s peak level indicates more pleasant surprises are in store for the massively mauled investors.”

“The market is capable of recouping massive losses on the strength of positive corporate background news after the current dust settles down,” another predicts adding “One may well ask why the dust was raised at all.”

In an identical crash in March last year, the market had fallen to the index level of below 7,000 points but staged a progressive recovery from the lows to 12,336 points a year later, reflecting its inherent strength based on technical cycles.

The amendments in the trading rules though was a bit late as they came after the market has declined by over 30 per cent and wiping out about Rs800 billion from the market capital during the last couple of weeks, which also included Wednesday’s biggest single-session index fall of 548 points.

The revision of trading rules are, among others, downward revision of lower locks from 20 per cent to five per cent, ban on short-selling in June future contracts, increase in exposure limits from 50 per cent to 100 per cent and increase in CFS facility from the existing 14 scrips to 30.

All the blue chips, which had dropped to their recent lows led the market advance under the lead of bank, oil and blue chips on the other counters, notable among them being National Bank, MCB, Pakistan Petroleum, PTCL, Pakistan Oilfields and many others, which finished well above their upper locks.

Most leading analysts believe the worst now may be over as strict adherence to amended trading rules could take away some of the negative initiatives being employed by the speculative forces to spread scare among the small investors followed by panic selling.

There are, however, two opinions about the future direction of the market but on technical ground and the market’s highly oversold positions reflects that the current process of recovery will be sustained during the coming sessions also as bulls and financial institutions could hardly miss an attractive bait of capital gains at the current levels.

Plus signs dominated the list under the lead of Wyeth Pakistan and Arif Habib Securities, which recovered Rs29 and 22.30, followed by Sanofi-Aventis, National Refinery, Treet Corporation, Neslte Pakistan, Attock Petroleum, PSO, Shell Pakistan, Al-Ghazi Tractors, Millat Tractors, Dawood Hercules, Pakistan Services, Pakistan Oilfields and IGI Insurance, up by Rs10.20 to 18.55.

EFU Life Insurance and Grays of Cambridge fell by Rs8.75 and 11. Others fell fractionally barring Siemens Pakistan, Gatron Industries, and Clover Pakistan, off Rs2 to 4.25.

Trading volume shrank to 130m shares from the previous 145m shares but gainers forced a strong lead over the losers at 280 to 47, with 15 shares holding on to the last levels.

National Bank topped the list of actives, sharply higher by Rs8.30 at Rs175.05 on 15m shares followed by Pak PTA, firm by 65 paisa at Rs6.55 on 12m shares, MCB, higher by Rs7.90 at Rs166.10, Pakistan Petroleum, up Rs8.60 at Rs181.50 on 8m shares, D.G.Khan Cement, up Rs3.60 at Rs75.60 also on 8m shares, PTCL, firm by Rs1.85 at Rs39.20 on 6m shares and Pakistan Oilfields, higher by Rs14.55 at Rs304.00 on 3m shares.

Other actives were led by Hub-Power, up Rs1.05 on 7m shares, Fauji Cement, higher by one rupee on 4m shares and Fauji Fertiliser Bin Qasim, up Rs1.30 on 3m shares.

FORWARD COUNTER: OGDC led the list of actives on this counter, up Rs5.70 at Rs120.05 on 7m shares, National Bank, higher by Rs8.35 at Rs176.15 on 6m shares and Pakistan Petroleum, higher by Rs8.65 at Rs182.60 on 4m shares.

D.G.Khan Cement followed them, higher by Rs3.60 at Rs76.05 on 3m shares and MCB, up Rs7.90 at Rs166.55 also on 3m shares.

DEFAULT COUNTER: Trading on this counter remained insipid as investors remained busy in the ready counter owing to recovery followed by active short-covering at the lower levels. Unity Modaraba was an exception, which rose by 10 paisa at Rs0.80 on 0.109m shares, while others were fractionally traded.