The share market here took a rebound during the week ended on January 30, 2009 and KSE-100 index surged by 447.87 points, or 9 percent, to close at 5,377.42 points. Trading activity improved and the average daily volume at the ready market increased by 82.8 percent to 180.674 million shares as compared to previous week''s 98.8 million shares.
Market capitalisation increased by Rs 123 billion to Rs 1.700 trillion. Outflow from foreign portfolio investment continued as the foreign investors withdrew $50.845 million during the week. The market opened on a negative note on Monday and the index lost 114.21 points to close at 4815.34 points.
On Tuesday, the market took upward trend and the index rose by 157.21 points to close at 4972.55 points. Positive momentum continued on Wednesday and the index breached 5,000 points level to close at 5,139.93 points with an increase of 167.38 points.
On Thursday, the market witnessed a volatile session, mainly due to profit taking. However, the index finally managed to close in the positive at 5,183.22 points, up by 43.29 points.
The positive trend continued on Friday and the index gained 194.20 points to close at 5,377.42 points level. Atif Zafar, an analyst at JS Global Capital, said that the central bank announced amendments in prudential regulations relating to provisions for loans and advances. According to the central bank, the banks would be allowed to take 30 percent benefit of forced sale value (FSV) for pledged stocks and mortgaged properties on non-performing loans (NPLs) effective from December 31, 2008.
The earnings of banking sector are expected to improve by 18-20 percent on availability of FSV benefit. As a result market capitalisation of the banking sector stocks increased by 17.3 percent during the outgoing week out pacing all other major sectors. Improved market sentiments amid FSV benefit and no sign of increase in interest rates in the monetary policy statement, have improved volumes during the outgoing week. The selling pressure by offshore investors continued during the week, however, it was absorbed by local investors as valuations became very attractive, he added.
Romessa Mirza at Invest Capital & Securities said that after several months of doldrums, KSE submitted itself to a relatively bullish sentiment in the face of several positive news, which helped keep investors sentiment relatively positive during the week. Trading volumes increased significantly as on January 28, the volume soared to 249 million shares, a level seen after about 160 trading sessions.
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