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RECORDER REPORT

KARACHI: Equities on the first session of the new year were all smiles and blue chips and core investment stocks rose appreciably in a sigh of relief on the ending of the hijacking drama of Indian airline plane last week and the government permission for the repatriation of funds from the country.

The KSE-100 index registered an increase of 48.17 points. The volume moved up to 134.346 million shares from 100.053 million shares of Thursday. The market capitalization finished at Rs 377.045 billion from Rs 366.669 billion of Thursday.

A couple of positive developments over the weekend boosted the confidence of the general investors which allowed bulls to defeat the attempts of bears to rule the stock market.

The Indian government released three Kashmiri detenus and over 150 passengers aboard in the Indian airlines plane were freed on Friday, which defused the tension. Though the Indian media is still blaming Pakistan, investors have totally ignored their claim and executed fresh deals in the choice scrips.

Another development which pushed the KSE-100 index to new heights was the State Bank of Pakistan's decision to allow foreign investor to repatriate their earnings. This was appreciated by the movers of the market, who thought that it would help government to attract fresh foreign investment in the stock market.

The market players also hoped that soon local investment would also pour into the stock market as the government had reduced the rate of return on national saving schemes from 16 percent to 15 percent.

Mohammad Zubair Ellahi of KAB Securities said that the positive movement in privatisation was steadily pushing the market up, taking it to new highs in recent past but the rally initiators were oil distribution stocks though the rise was broad based. The approaching clearing and holidays ahead might force some position squaring but the overall outlook was still positive.

A leading analyst said that though the government had allowed repatriation of funds from the country it would take time to re-enter the market. Several fund houses were closely monitoring the economic scene and market experts said that they might start buying shares at the end of the first quarter of 2000. By that time they said that the economic policies of the country would be clearer and results of new measures more visible. Already the revenue collection has improved in the first six months of 1999-2000 reaching to around Rs 156 billion which has been a positive portent for the market.

PTCL rose by Re 1 to Rs 22.70 on total business of 36.989 million shares, Hubco on a trading of 25.461 million shares finished at Rs 21.95, higher by 60 paisa, PSO saw an increase of Rs 17.45 to Rs 211.45 on total deals of 24.867 million shares, Fauji on a volume of 6.842 million shares recorded a rise of Rs 2 to Rs 55.20 and Sui Northern Gas on a turnover of 6.764 million shares closed at Rs 12.60, showing a rise of 60 paisa.