KARACHI – The local bourse underwent bullish activity on Friday as investors’ were confident that the interest rate would stay unaltered and were optimistic of an early introduction of the most-awaited leverage product.
On last trading day of the week, the KSE-100 benchmark maintained the 30-month high, gaining 91.42 points to stand at 12,329.65 points against 12,238.23 points. “Leverage mania lifts the benchmark backed by substantial turnover, for new highs,” viewed Hasnain Asghar Ali of Aziz Fidahusein and Company.
With a respective intraday high and low of 12,363.10 and 12,238.23, total turnover of traded shares at the ready-counter registered a significant increase of over 30.9 percent or 71 million to close at 300.50 million in comparison to the previous 229.463 million. Mehanti said that positive activity at KSE was also attributed by the higher global commodity prices. “Institutional and foreign investors accumulated scrips across the board on strong valuations despite concerns for rising fiscal deficit and circular debt in Pakistan’s energy sector,” he added.
The market capitalisation on Friday also ended up as high as 21.73 billion to close at Rs 3.391 trillion against Rs 3.369 trillion. Trading at the future market also registered an encouraging growth of 3.53 million with the turnover closing at 12.367 million as compared to 8.834 million on Thursday.
Fauji Fertilizer Bin Qasim was the volume leader as some 30.56 million shares were traded during the day. Dilating on the factors that made the bulls dominant at the Karachi bourse, Husnain Asghar said that anticipation of an early launch of the new leverage product kept the bulls going, although expensive stocks faced off-loading by the corporate and well-informed participants, having an access to the privileged information regarding leverage product development. However, renewed buying in stocks offered consistent yields as profit booking was opted.
While those carrying potential of a substantial rise in valuation following the introduction of ready-board leverage mechanism along with high interest of the financial groups in their respective listed stocks and not far behind on gains and turnover, were the listed holding companies on likely portfolio appreciation, kept the positivism alive, thus keeping the bench-mark and the turnover on gaining grounds, he added.
The analyst said the likelihood of improvement in stock valuations after the introduction of ready board leverage would certainly increase the trading capacity of the local participants. “While high quantum activity by the off-shore participants is likely to be an add-on,” he said. Husnain said that with a rising stock prices, the anticipation of high payouts and earnings were duly on the rise either through core business or with the support of technical entries.
