KARACHI: The stock market rose steadily following Monday’s panicked drop as investors regained confidence after reassurances from the government, and on expectations of a rise in interest rates.
The Karachi Stock Exchange’s (KSE) benchmark 100-share index rose 1.84% or 412.87 points to end at 22,790.70 points.
“Pakistan equities started the day on a positive note and continued with the momentum, as investors brushed aside macroeconomic concerns on the Prime Minister’s comments over continuation of peace talks with the militants,” said Fareesa Baig of Elixir Securities.
“Leading the rise today were oil names that gained strength over heightened foreign interest. Also, financials remained in limelight over expectations of an interest rate hike in the upcoming monetary policy this month, with banking giants MCB Bank (MCB PA +1.8%), National Bank (NBP PA +2.5%), United Bank (UBL PA +2.3%) attracting investor interest. Engro Corp (ENGRO PA +5%) hit upper price limits on local interest as investors now see most of the concerns with respect to the fertiliser and foods business priced in,” Baig added.
“The bulls finally strangled the defined (bears) on the back of exuberant activity in the telecom and banking sector. The market rebounded on the basis of heavy short-sell covering and some help from foreign inflows but volumes remained low,” said Wasi Khan of JS Global.
“Banking sector rallied on account of 50 basis points hike expectation in November’s monetary policy statement. At the eleventh hour, we witnessed buying in oil sector which indicates that investors are moving towards blue chip stocks with low beta (less sensitive than market),” Khan explained.
Trade volumes fell to 87 million shares compared with Monday’s tally of 91 million shares.
Shares of 307 companies were traded on Tuesday. At the end of the day 170 stocks closed higher, 105 declined while 32 remained unchanged. The value of shares traded during the day was Rs4.7 billion.
Bank Al Falah was the volume leader with 11 million shares gaining Rs1.15 to finish at Rs24.16. It was followed by Pakistan Telecommunication Company Limited with 8.4 million shares gaining Rs0.26 to close at Rs26.26 and Bank of Punjab with 4.1 million shares gaining Rs0.1 to close at Rs10.38.
Foreign institutional investors were net buyers of Rs454 million, according to data maintained by the National Clearing Company of Pakistan Limited.
Published in The Express Tribune, November 6th, 2013.
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