Bulls turn up the heat at KSE

Bullish trends after Asian Development Bank’s offer to lend a $2 billion emergency package.

The stock market continued its bullish trend for the third day on the back of local and foreign investors buying following Asian Development Bank’s offer to lend a $2 billion emergency package.

The Karachi Stock Exchange (KSE) benchmark 100-share index on Thursday ended 1.47 per cent or 142.6 points higher at 9,847.6 level.

The ADB offered the package to help the government rebuild its damaged infrastructure and rehabilitate the people affected by the floods.

The floods have killed up to 1,600 people and disrupted the lives of about 20 million people, nearly 12 per cent of the population.

The finance ministry has already said that the country would miss this year’s 4.5 percent gross domestic product (GDP) growth target.

Volumes remained on the lower end as retail investors and jobbers opted to stay on the sidelines due to lack of clarity on the leverage product, said Elixir Securities dealer Sibtain Mustafa.

Trade volumes fell to 55.9 million shares compared with Wednesday’s tally of 59.5 million shares.

Cements witnessed fresh buying as investors expect potential growth in volumes owing to reconstruction activities of flood effected areas, said Mustafa.

Banks also witnessed activity, with MCB Bank driving the sector, after the central bank announced non-performing loans numbers that increased on quarterly basis.

MCB Bank and National Bank of Pakistan (NBP) alone contributed more than 16 per cent of the total traded value.

MCB Bank jumped Rs5.16 to close at Rs196.64 while National Bank of Pakistan rose Rs1.11 to end at Rs65.83.

A rally is expected in the market which will push the index towards the 10,000 point level, predicted Mustafa.

Oil and Gas Development Company, NBP and Pakistan Oilfields will be among the primary drivers, added Mustafa. Shares of 360 companies were traded on Thursday. At the end of the day 201 stocks closed higher, 141 declined while 18 remained unchanged. The value of shares traded during the day was Rs1.98 billion.

Lotte Pakistan PTA was the volume leader with 6.5 million shares as locals institutions showed interest in the scrip. The stock rose Rs0.36 to finish at Rs7.95.

It was followed by DG Khan Cement with 4.3 million shares firming Rs1.02 to close at Rs25.34 and Jahangir Siddiqui and Company with 3.3 million shares gaining Rs0.15 to close at Rs10.98.

Published in The Express Tribune, August 20^th, 2010.