Stocks recover from the overnight lows
KARACHI — Pakistani stocks yesterday staged a broad rally boosted by active short-covering in the oil shares followed by reports of increase in world oil prices and sympathetic covering purchases on the other counters, notably leading bank shares.
"Essentially, it is institutional based rally," a leading stock analyst Faisal A. Abbas said "tired institutions could not sit idle on their liquid cash and resume normal business at the lower levels."
The KSE 100-share index posted a gain of 153.15 points at 12,436.19 as compared to 12,283.23 a day earlier as all the leading base shares ended higher under the lead of MCB, which has a weightage of 11 per cent in it and an upper lock was applied to forestall fresh speculative rise in its share value on technical grounds.
It finally finished with a smart rally of Rs15.20 at Rs319.70 and accounted for 12 million shares, the net rise in its share value being five per cent in the session.
Anohter analyst Hasnain Ali Asghar hopes that the snap rally could be sustained in the coming sessions also but doubts background news from different fronts are not that positive.
Investors are, however, worried over the proposed three-day strike by the city transporters to protest the killings of May 12 and violence linked to such protests, analysts said "It could take away steam out of the market atleast for the near-term signs of which are already visible in the falling volumes."
Bad news both from the political and law and order front are following in quick succession never allowing investor to plan a long-term portfolio adjustment strategy, analyst Ashraf Zakaria think adding "everybody is awaiting to invest after the political dust settles down."
The perception that the index will settle somewhere well above the level of 12,500 points appear to be a bit difficult in the developing political situation and investors will think twice to invest even at the falling prices.
"There is more than one reasons having bearish impact on the share market, main among them being perception of political uncertainty," analyst Ahsan Mehanti said. He further added "all the political indicators originating both official and private sources are terribly bearish."
MCB and Siemens Pakistan were leading among the gainers, up by Rs50.00 and 15.20, while Lakson Tobacco and Nestle Pakistan were leading among the losers, off by Rs7.90 and 26.00 respectively.Trading volume rose to 217 million shares from the previous 129 million shares as gainers held a strong lead over the losers at 226 to 115, with 36 shares holding on to the last levels.