Index gains 256 points as panic subsides

November 23, 2014 9:32 pmComments Off on Index gains 256 points as panic subsidesViews: 523

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KARACHI: Shares rebounded on Friday with the KSE 100- index recouping some of the huge losses as panic subsided over the impact of the suspended brokerage house KASB Securities on the market.

The index gained 255.80 points or 0.82 per cent to close at 31494.84 points.

Shares across the board rallied, led by Auto and Pharmaceutical sectors. Volumes remained relatively low as institutional investors decided to stay aside until the dust on the political front. Mutual funds, who were major sellers a day earlier, also remained on the sidelines on Friday.

Over the week, the KSE-100 index was noted to have gained 157 points or 0.48pc. The index reached an all-time high closing of 32,006 during the week, before correcting in the latter sessions. Volumes declined by 8.6pc WoW to 259 million shares and average daily value traded also decreased by 3.4pc WoW to $148m. FIPI was recorded at $5m, a drop of 52pc from $10m seen last week.

Analyst Abdul Azeem at Invest Capital commented that the positive sentiments prevailed earlier in the week due to a cut in the policy rate by 50bps by the SBP on low CPI.

However, investors’ sentiments weakened when the negative developments emerged during the week, including SECP decision to place KASB Bank under suspension for six months; mounting political tension between government and PTI, the latter planning to hold rally against the government on 30th; swelling current account deficit and increasing energy chain receivables.

Going forward, the declining trend in Pakistan Investment Bonds yields was thought to support the equity market.

Most analysts thought that the tone of the market was bullish.

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