Expectations of strong results push KSE index 41 points up

KARACHI: Expectations of strong result announcements by banks and oil stocks kept the bullish rally alive at the Karachi stock market on Wednesday.

Analysts said another factor for the positive momentum was investors’ positive sentiment in the wake of continuation of NIT State Enterprise Fund’s support to the market.

The Karachi Stock Exchange (KSE) 100-share index gained 40.51 points or 0.69 percent to close at 5,880.14 points as compared to 5,839.63 points traded in the previous session. The KSE 30 index also gained 58.66 points and closed at 6,084.95 points as compared with 6,026.29 points of the previous session. The KMI 30 index gained 3.11 points to close at 7,866.65 points as against 7,863.54 points of the previous session.

Analysts said an extremely range-bound session was witnessed at the market offering limited trading opportunity to day traders. Selected stocks continued to invite buying interest disallowing an extended adjustment.

The market turnover went down by 7.76 percent and traded 191.59 million shares as compared to 177.79 million shares traded in the previous session. The overall market capitalisation went up by 0.60 percent and closed at Rs 1.835 trillion as compared with Rs 1.824 trillion traded in the previous session. Out of 269 companies, 132 closed in positive zone, 124 in negative while 13 remained unchanged.

Traders said top tier stocks of the sectors awaiting results did display strength on the anticipations that the results will be at par with the results already announced of the leading stocks.

Although cash payouts have been a prominent feature of the announcement season, future ability of the main board to stay consistent on the front has forced even the liquid participants to give priority to capital gains, rather to wait for dividend materialisation. The shallow market has kept the chance of adjustment alive in the event of change of hands; cued up buyers on substantial discounts and unprecedented support by the state fund to the highlighted stocks, will keep the downside confined provided the political and geo political fronts stay calm.

Market movement suggests a downward adjustment ranging between 3 percent to 3.5 percent in the coming sessions. Adjustment will certainly shatter away some likely buyers and buying by the remaining will offer decent support. Dips can be awaited for accumulation. Sectors having least impact of the economic downturn can be looked for placements.

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