Three-day rally propels index past 37,000

KARACHI: The stock market extended its rally into the third day on Friday as the KSE-100 index propelled by 334.60 points (0.91 per cent) to close at 37,130.63. The market opened positive and remained bullish for the entire session on the last trading day of the week and the index touched intraday high by 362 points.

Investors were enthused by the results season where many companies posted earnings that were higher than expectations. Although individuals and mutual funds have continued to opt for profit-taking in previous sessions, the mood remained on the sunny side as foreigners were seen to have swooped to pick up attractively valued stocks; foreign buying in the previous three sessions stood at a healthy $10.2m.

All of that encouraged investors to push aside the discounting issues of International Monetary Fund bailout; its timing and mainly the feared conditions of further rupee depreciation; monetary tightening and spike in gas and electricity charges, which could bite into the corporate profitability.

Analysts believed institutions participated in trading in blue-chip scrips as volume rose to 144m shares, up from 107m and traded value jumped to Rs5.2 billion, from Rs4.2bn.

Buying was largely driven by value hunters who took fresh positions in cement after the sector had received severe battering in the previous several sessions. It added 79 points to the index gain with all major shares, hitting their upper circuits.

Major contribution to the index upside came from Lucky Cement, increasing by 4.91pc, Pakistan Tobacco 5pc, Dawood Hercules 3pc, DG Khan Cement 4.99pc and Fauji Cement 5.60pc, adding 139 points. On the flip side, MCB, decreasing by 0.94pc, Bank Al Habib 1.14pc and United Bank 0.55pc took away 39 points.