KARACHI, Jan 2: Stocks on Thursday recovered from the overnight lows boosted by across-the-board two per cent cut in profit rates on all the national saving schemes amid predictions of steady inflow of fresh funds into the share business.

All roads may not have led to the share market after the rate cut, there is a perception and shared by many analysts that an attractive bait of capital gains could attract any amount of fresh investment in the coming weeks.

The KSE 100-share index, which has fallen below the crucial level of 2,700 points, recovered to finish higher by 44.01 points at 2,710.54 as compared to 2,666.53 a day earlier. All the leading base shares finished with smart gains under the lead of PTCL and Hub-Power. Market capitalization also rose by Rs8.333 billion at Rs595.947 billion.

The perception of steady inflow of fresh funds from the genuine investors as return in share business may be much more than on official investment schemes did not allow bulls to sit on the sidelines. Hence the recovery.

National saving schemes include, among others, defence certificates, special saving certificate and special dollar schemes.

“The technical correction proved short-lived as widely speculated”, brokers said adding “positive news follow in quick succession keeping bulls at their toes all the time”.

The snap rally was initiated by the oil marketing giants, notably PSO and Shell Pakistan in response to recent increase in petroleum prices and expectations of higher profits followed by most of the blue chips on other counters ably assisted by the fertilizer shares including Fauji and Engro Chemical.

A good bit of dividend-related anticipatory buying was also noted on those shares whose financial years closed on Dec 31, 2002.

“There is a talk of foreign buying on selected counters but it is pretty hard to find evidence”, brokers said adding “the sustained run-up is being funded by cash heavy financial institutions”.

Leading shares, which came in for active support were led by Mari Gas, PSO, Pakistan Refinery, Dawood Hercules and Arif Habib Securities, rising by Rs3.75 to Rs12.05.

Other good gainers included Javed Omer, Pakistan Oilfields, Indus Motors, Pak-Suzuki Motors, Fauji Fertilizer, ICI Pakistan and Packages, which rose by Rs1.75 to Rs3.

Losers were led by Service Industries, Sarhad Cigarettes, Sapphire Fibre, Pakistan Reinsurance Co and Wyeth Pakistan, off Rs1.50 to Rs20, the largest fall being in Wyeth Pakistan.

Trading volume, however, showed a sharp contraction at 349m shares from the previous 542m shares but advancing shares maintained a fair lead over the losing ones at 167 to 120, with 48 shares holding on to the last levels.

Hub-Power again led the list of actives, up by 10 paisa at Rs40.60 on 104m shares followed by PSO, higher by Rs7.65 at Rs215.65 on 49m shares, PTCL, higher by 20 paisa at Rs25.55 on 48m shares, Pak PTA, sharply higher by Rs1.45 at Rs8.60 on 45m shares and Sui Northern Gas, firm 40 paisa at Rs24 on 24m shares.

Other actives were led by ICI Pakistan, higher by Rs3 on 17m shares, FFC-Jordan Fertilizer, firm by 30 paisa on 9m shares, Fauji Fertilizer, up by Rs2.30 on 8m shares, Engro Chemical, higher by Rs1.55 on 7m shares and D.G. Khan Cement, up by 50 paisa on 5m shares.

FORWARD COUNTER: PSO also came in for strong speculative support on the forward counter and rose by Rs6.75 at Rs217.50 on 13m shares, while Hub-Power was marked up by 15 paisa at Rs40.85 on 27m shares and PTCL, recovered 25 paisa at Rs25.90 on 12m shares. The hereto neglected Pak PTA suddenly burst into activity followed by reports of higher sales and rose by Rs1.50 to close at Rs8.60 on 3m shares.

Engro Chemical, Fauji Fertilizer and ICI Pakistan also attracted strong buying and finished higher by Rs1.95, Rs2.30, Rs2.30 at Rs93, Rs75.70 and Rs57.75 respectively.

DEFAULTER COMPANIES: Shares of a dozen companies came in for trading but activity remained slow owing to the absence of leading buyers. Quice Foods came in for stray support and rose 10 paisa at Rs1.50 on 15,000 shares followed by Medi Glass, firm by five paisa at Rs0.75 on 13,000 shares and Metropolitan Steel, up by 30 paisa at Rs20.70 on 8,500 shares.