Shares attractive value invites renewed buying

LAHORE - The bulls on Tuesday made a comeback with full strength, as the attractive value of the leading stocks invited fresh buying by the local players mainly due to the rumours that the ECB might propose an extension of two years in CGT on equity trading.

The Karachi Stock Market 100-index climbed to 12,822 level, registering an increase of 237 points.

Hasnain Asghar Ali, a market expert from Aziz Fidahusein and Co, pointed out that flexibility shown by SBP on the notice, restricting banks exposure in equity markets up to 50% of the equity also invited real time bottom fishing as this had been haunting the investors.

The KSE 30-index closed at 15144.46 levels with a gain of 436.37 points. All shares index closed at 9,180.23 levels with a gain of 160.93 points.

Trading activity was better as compared to the last trading session as the Ready market volume stands at 263.767million as compared to last trading session 143.823 million.

Future market volume however increased and stands at 83.882 million shares as compared to last trading session 40.350 million.

Market capitalization stands over Rs .3.876 trillion. Total trades increases to 165,737 as compared to last trading session of 78,118. As many as 203 companies advanced, 115 declined and 14 remained unchanged.

Highest volumes were witnessed in AHSL at 19.988 million closed at Rs. 164.50 with a gain of Rs. 2.95 followed by NIB at 19.409 million closed at Rs. 13.00 with a gain of Rs. 0.56 & DGKC at 12.774 million closed at Rs. 76.25 with a loss of Rs. -0.02.

Trend forecasting oscillators are currently bearish and the KSE 100-Index is currently 10.7% below its 200-day moving average and is displaying a trend.

As far as resistance level is concerned, the market will see major 1st resistance level at 12981.04 and 2nd resistance level at 13139.83 while Index will continue to find its 1st support level at 12504.67 and 2nd support level at 12187.09.

Technically index found strong support around 12396-12410 after making an early low of 12345(-239), while index managed a closing well above the over head resistance of 12725-12732 (the level offered strong resistance twice) over head resistance therefore stays at 13010-13017.  

Dealers said that with oil trading at the peak levels and availability of dividend of rich companies at extreme discounts sparked short covering that triggered a massive recovery.

Even the banks witnessed healthy accumulation besides fertilizer stocks.

Money supply issues might continue to disallow leverage players for the time being, restricting the turnover, while value buying is likely to continue for a while. It is, therefore, recommended to accumulate main board stocks around closing levels and on dips, suggested an expert.