Bullish flames leapt up over Karachi Stock Exchange (KSE) on Monday on the former finance minister, Shaukat Aziz, being nominated as prime minister with expectations that government's asset sale plan would speed up and help boost the economy.
The KSE-100 index showed a gain of 173.34 points, or 3.4 percent, to 5279.03 as compared with 5105.69 and a turnover of 392 million shares as against 237 million shares of Friday.
The share prices skyrocketed on development that Shaukat Aziz would take over as prime minister in the next two months. His appointment has been taken as an extremely positive move which would lead to both stronger economic reform and greater political stability.
The nomination of Shaukat Aziz as Prime Minister would give big comfort to those foreign investors who are reluctant to invest due to their perception of high political risk in Pakistan, Ashraf Bava, head of equity sales at Elixir Securities said. "We expect the index to touch new highs, possibly 6000 level, in a few months' time," he added.
PSO recorded gain on expectation that the government might call fresh EOIs to be announced very soon with Kuwait Petroleum taking a renewed interest. PTCL was up on expectations that the company would announce a dividend of Rs 4 per share for the year ending June 30, 2004.
Hasnain Asghar at Aziz Fidahusein said that financial institutions, stockbrokers and individual investors gave a red carpet welcome to Shaukat Aziz. The index opened after gaining one percent, or more than 50 points, as institutions and local punters placed sizeable deals in choice scrips.
The healthy economic figures and improving fundamentals, accompanied by upcoming corporate announcements, have placed the local bourses in a comfortable position, he said. Technically, the index will continue to find support around 5210-5217 while overhead resistance stays at 5333-5339.
Cyra Patricia, research analyst from Live Securities, said that the bulls rejoiced as heavy buying was witnessed all daylong by financial institutions in blue chip companies.
Confidence among small investors was crystal-clear as giants went out shopping. Cement and oil & gas sectors remained in the limelight through the day, till session's end. "We expect the market to continue its upward trend, keeping in mind Shaukat Aziz as next Prime Minister." Important element was the sudden jump in trading volumes which enabled the investors to build their long positions for their prosperous returns.
OGDC rose to Rs 64 from Rs 61.65 on business of 42.67 million shares; D G Khan Cement rose Rs 2.60 to Rs 58.15 on trading of 26.99 million shares; PTCL rose 90 paisa to Rs 42.50 on turnover of 26.2 million shares; National Bank of Pakistan closed at Rs 66.90, higher by Rs 3.65 on volume of 25.6 million shares; and Fauji Cement showed an increase of Rs 1.30 to Rs 17 on total deals of 21.7 million shares.
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