KARACHI: The Karachi bourse on Wednesday staged a spectacular comeback contrary to expectations of another bearish session ahead of Eid holidays starting today. The index had witnessed three consecutive sessions before yesterday’s rebound. Index heavy Oil and Gas Development Company led the charge after its result announcement sunk in that earnings were below estimates due to a one-off tax adjustment. The market is going to remain closed for the week.
The Karachi Stock Exchange’s (KSE) benchmark 100-share index jumped 2.72% or 615.26 points to end at the 23,237.19-point level. Trade volumes still remained low, but rose to 175 million shares, compared with Tuesday’s tally of 136 million shares.
“Pakistan’s equities opened the last trading day of this week somewhat shaky, but soon managed to gather ground and snap out of the negative streak after three consecutive trading sessions in the red,” reported Fareesa Baig, analyst at Elixir Securities. The KSE-100 index gained 2.7% on Wednesday after being down 2% over the first two days of the week.
Index heavyweight OGDC was major gainers during the day as oversold momentum finally reversed. Unwinding positions in the deliverable futures market also confidence to participants, while foreign institutional interest also remained high, said JS Global Capital analyst Ovais Ahsan.
Pakistan Petroleum and Pakistan State Oil also jumped the bull bandwagon, hitting their respective upper locks, as investors chose to capitalise on bargains for the earnings season.
The banking sector also fuelled the momentum with banking giants National Bank of Pakistan, MCB Bank and United Bank actively participating on expectations of an interest rate hike in the next monetary policy.
Engro Foods also recovered after shedding about 25% of its share value in the last ten trading sessions amid heightened sentiments in the broader market. Its parent Engro Corporation also followed suit along with cement and textile stocks without any specific news catalyst.
Shares of 337 companies were traded on Wednesday. At the end of the day 250 stocks closed higher, 57 declined while 30 remained unchanged. The value of shares traded during the day was Rs8.76 billion.
Bank of Punjab was the volume leader with 21.56 million shares gaining Rs0.91 to finish at Rs13.68. It was followed by National Bank of Pakistan with 11.58 million shares gaining Rs2.72 to close at Rs57.33 and Fauji Cement with 10.48 million shares climbing Rs0.58 to close at Rs14.95.
Foreign institutional investors were net buyers of Rs331 million, according to data maintained by the National Clearing Company of Pakistan.
Published in The Express Tribune, August 8th, 2013.