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RECORDER REPORT

KARACHI: The bulls were in a commanding position at the pre-Eid session on Thursday and all investment stocks staged a smart recovery as some foreign investment poured into selected shares, in response to government efforts to cut lending rates by two percent to make the environment conducive for business community.

The market during the opening hours was quite weak as the leading dealers and traders adopted a cautious approach following declines in the international stock markets. However, the sentiment changed and the index was once again on the winning streak, with appreciable gains in PTCL, Adamjee Insurance, KESC, Fauji and Lever Brothers.

The KSE-100 index registered an increase of 20.09 points or 1.36 percent to 1499.80 from 1479.71 of Tuesday. The volume moved up to 131.325 million shares from 174.205 million shares of Tuesday. The market capitalisation finished at Rs 387.523 billion from Rs 382.213 billion of Tuesday.

The market closed on a positive note as expected by most of the seasoned traders. They believed that the measures taken by the government were moving in the right direction. The cut in the lending rates would give cheaper liquidity to industrial sector making their products competitive in the international market. Also the cut offered by the banks would cushion the industrial sector against the imposition of general sales tax and rise in petroleum prices by 10 percent.

Faisal Abbas of AHR Securities said that despite Thursday being the last working day of the week, before five consecutive holidays would commence from Friday the market sentiment remained bullish.

Although the trading was bearish in the beginning, genuine buying interest in the selected blue chips did not allow the bears to take control and sharp recovery started.

He added that the genuine investors were moving towards the capital market on account of a number of factors such as lowering of interest rates and, plunging gold and dollar prices. In addition, the recently announce results of various blue chips showed that the scrips were still under-priced and hence the market had been improving smoothly for the last serval some sessions almost touching the 1500 barrier.

Mohammad Zubair Ellahi of KAB Securities said that the market was highly positive. Advance to decline ratio and strength in high weightage stocks, exhibited inherent market strength.

He added that the index had gained 120 points in just four sessions and optimism was still running high. Stock prices and major indicators were at record highs. The broader term outlook still looked positive but it would be appropriate to realise gains and wait for dips.

The stock market after Eid holidays is expected to remain in the bullish frame. However, it might see some selling pressure from the profit hunters and sundry jobbers.

The index is likely to gain over 20 to 30 points if an IMF team arrived in Islamabad to negotiate with Pakistani officials about the release of $280 million tranche from the $1.56 billion credit line approved last January.

PTCL rose by 50 pasia to Rs 23.75 on total business of 34.152 million shares, PSO saw a fall of Rs 1.25 to Rs 212.50 on total deals of 20.190 million shares, Hubco on a trading of 14.521 million shares remained unchanged at Rs 22.05, Sui Northern Gas on a turnover of 12.553 million shares closed at Rs 14.65, showing a drop of five paisa and ICI on a volume of 9.793 million shares recorded a rise of five paisa to Rs 11.25.