Karachi stocks surge 195 points on WB’s approval of $500m loan

KaRACHI: Bullish sentiments prevailed in the Karachi stock market on the last trading day of the week Friday as investors took positively the news of approval of $500 million interest free loan from World Bank and went for buying activities.

The KSE 100-share index gained 194.97 points or 2.95 percent to close at 6,803.46 points as compared with 6,608.49 points traded in the previous session. The KSE 30-share index also gained 218.10 points and closed at 7,340.33 points as compared to 7,122.23 points of the previous session. The KMI 30 index also increased by 322.61 points to close at 9,407.31 points as against 9,084.70 points of the previous session.

Other positive factors that affected the market sentiment were Nishat Mills’ bid to buy AICL shares, recovery in international equity markets, renewed foreign interest and expectation of reduction in discount rates.

The market turnover surged by 11.89 percent and traded 229.61 million shares as compared to previous session’s 205.21 million shares. The overall market capitalisation fell 2.87 percent and closed at Rs 2.043 trillion as compared with Rs 1.986 trillion traded in the previous session. Out of a total of 354 companies, 232 closed in positive zone, 107 in negative while 15 remained unchanged.

Analysts said reports of confirmation of WB’s grant of $500 interest free loan and offer by WB of converting $67.5 million loan into grant allowed the market to ignore the last day phobia. Low turnover initially never allowed an excited run-up, while accumulation at discounted levels allowed the index to stage a decent recovery.

Buying-spree allowed the index to breach and sustain above major resistance of 6,770 points to 6,773 points as the whisper of increased foreign inflow invited the active corporate and retail participants with comparatively high energies.

Absence of the trigger kept likely new entrants on the sidelines, as the whisper that recent surge is being maintained for dressing up the quarterly financials of the companies, gave the perspective buyers an excuse to wait for dips.

Brokers said buying activity was witnessed in the market as investors took positions in blue chip companies in the oversold zone.

The KSE 100 index opened in the green zone with a gain of 23.67 points and at the end of the day closed at 6,826.99 points with a gain of 218.50 points. staff report