KARACHI, July 9: Heavy buying in bank shares featured in the Friday trading as institutional traders covered positions on this counter aided by reports of higher interim earnings and predictions of handsome return on investment.

The KSE 100-share index recovered another 30 points at 5,453.55.

It was perhaps for the first time that the market rally was initiated by shares outside the ambit of major trend-setters and reflects a judicious blend of both genuine and speculative buying, one analyst said commenting on the meteoric rise of the bank shares.

The session's best levels, however, could not be sustained on some counters because of weekend selling by some of the bargain- hunters and speculative traders and some of them finished with clipped gains.

The KSE 100-share index early rose to hit the day's peak level at 5,460 but as the follow-up support turned shy, it finished modestly reacted around 5,453.55, up 29.81 points over the last close of 5,423.74 points.

The perception of a robust stock market in the months to come after the finance minister, Shaukat Aziz takes over as prime minister has already forced the "big ones" to change their future buying priorities, analysts said.

"Most of them are eyeing the index level of 6,000 possibly by the end of August and that goal now does not appear elusive," they added. The entry of the weightage of the Pakistan Petroleum and potential of further price appreciation both in PTCL and OGDC could make it an easy target.

"But one thing is still not clear whether or not another price flare-up will follow it," they fear on the ground that some of the leading shares are already trading close to their saturation levels.

The initial smart rally was supported by active short- covering in bank shares, notably National Bank, Bank of Punjab, ICI Pakistan and Sui Northern Gas amid reports of higher corporate earnings and talk of good interim dividend.

According to market sources most of the leading banks have earned handsome interim profits alone on capital gain account owing to boom conditions prevailing on the stock market since January.

The interim profit rates declared by some of them for the six months ended June 30, give a fair idea of their earnings and investors are not that "fool to chase their share values so high", says a leading broker.

PTCL also maintained its upward drive for the fourth session in a row on reports of higher interim earnings and but late selling in two other trend-setters, OGDC and Bank of Punjab, evoked sympathetic selling on some other counters, dealers said.

Trading volume showed sharp increase at 360m shares as compared to 276m shares a day earlier but losers held a modest lead over the gainers at 155 to 132, with 38 shares holding on to the last levels.

National Bank topped the list of most actives, up Rs3.35 at Rs71.70 on 69m shares followed by Bank of Punjab, higher by Rs4.45 at Rs63.95 on 56m shares, DG Khan Cement, firm by 50 paisa at Rs59 on 25m shares, ICI Pakistan, higher by Rs2.70 at Rs95.65 on 24m shares and PTCL, steady 45 paisa at Rs43.95 on 23m shares.

Other actives included OGDC, firm by five paisa on 22m shares, Sui Northern Gas, up 35 paisa on 20m shares, MCB, higher by Rs1.70 on 13m shares, Lucky Cement, up 45 paisa also on 13m shares and Maple Leaf Cement, unchanged on 12m shares.

FORWARD COUNTER: Pakistan Petroleum maintained its downward drift on renewed selling and ended further lower by Rs2.30 at Rs107.30 on 17m shares followed by OGDC, easy five paisa at Rs67.10 on 7m shares, Sui Northern Gas, up 65 paisa on 4m shares, National Bank, higher by Rs3.40 at Rs71.90 also on 4m shares and PTCL, up 35 paisa at Rs43.95 on 4m shares.

DEFAULTER COS: Trading activity on this counter failed to pick up as investors remained busy in the ready section owing to rising prices. Cres-Standard Bank was an exception, which came in for active support at the previous level, unchanged at Rs9.90 on 0.144m shares. Others were modestly traded. Lucky Cement, ICI Pakistan, DG Khan Cement and some others.

DIVIDEND: Al-Meezan Investment Management (Meezan Islamic Fund), bonus shares at the rate of 15 per cent.