KSE hits 13-month high ahead of Eid holidays

KARACHI: The last session of Ramazan proved to be a boon for the Karachi bourse as investors ignored the high risk present there and accumulated bulk of stocks ahead of Eid holidays.

With another sharp increase of 2.31 per cent or 213.43 points on Friday, the KSE 100-share index jumped to a 13-month high at 9,436.80 points. This is the highest closing level after August 26, 2008 when the market ended at 9,430.29 points.

The parallel running junior 30-share index also surpassed the 10,000 points threshold successfully on massive price-hike and closed at 10,146.21 points, booking another gain of 2.11 per cent 210.15 points in this session.

The leading banking, exploration & production, oil marketing and telecommunication stocks altogether gave gains in the indices at the bourse. Notably, National Bank, MCB Bank, Habib Bank, United Bank, Oil & Gas Development Company, Pakistan State Oil and Pakistan Telecommunication Company; each of them contributed points to indices in double digit, in range of 10-43 points.

Analysts said the landing news of further recovery in the local economy, along with receding of world economic recession and particularly in Asia, kept equity investors booming, blooming and blossoming at the bourse.

Further increase in foreign exchange reserves of the country above $14 billion at current and turning of current account deficit into the ‘surplus’ in the single month of August-2009 at $82 million pushed up market to new height.

The foreigners grave interest in local markets also remained one of the leading factors behind lifting of market to this high. The offshore investors, therefore, injected another smart tranche of $7.78 million in this single session at local bourses, according to NCCPL, and continued to increase their margin of holdings here.

Analyst Ahsan Mehanti said rise in urea & DAP off-take by 42 per cent on yearly basis; rising foreign exchange reserves; high international crude oil prices; rising global equity markets; continuing foreign interest in banks, oil and fertilizer scrips and last but not the least the resolution of circular debt issue played a catalyst role in positive activity on the Karachi bourse.

The resolution of circular debt kept the oil marketing companies (OMCs), refineries and Independent Power Producers (IPPs) shining here at the local bourses, he added. Handsome gain in shares prices also helped the market generate slightly hither turnover on the board at 244.56 million shares.

This is 10 per cent higher than 222.19 million shares changed hands yesterday.

In accordance with the overall market performance, the overall market capitalisation surged by another Rs45 billion and stood at Rs2,727 billion. Analyst Hasnain Asghar Ali said as “we get closer to the announcement of next monetary policy,” the relaxations likely to be offered to the banking industry in this, continued to invite renewed buying interest. Leading from the front was the banking sector, while the major beneficiary of likely settlement of circular debt issue after initial off-loading continued the spree of hitting upper circuit, he said.

Investment companies stayed sentiment booster as well as contributed substantially to the turnover. The oil and gas exploration stocks continued to face off-loading mainly by the local participants. Sell-off, however, failed to have an impact as the other sector stocks banking, fertilizer and textile kept the activity alive, Ali further said. Out of total 365 actives, 254 stocks advanced, 87 stocks declined, while the value of remaining 24 stocks remained unchanged.

Highest volumes were witnessed in JS Company at 30.89 million closing at Rs30.53 with a gain of Rs1.45, followed by AH Securities at 13 million closing at Rs40.42 with a gain of Rs1.75, Pakistan Telecommunication Company at 12.442 million closing at Rs21.21 with a gain of Rs1.01, National Bank at 12.28 million closing at Rs84.23 with a gain of Rs3.77, and Pak.PTA at 10.54 million closing at Rs5.38 with a loss of 14 paisa. Link...