After the much anticipated Panama Case verdict was announced on Thursday, the market jumped 1877 points to breach the 49,000 level which was last seen a month before on March 22, 2017.
The rapid gain in the market came on the back of positive market sentiments which witnessed uncertainty in the last couple of sessions. Overall the stock market accelerated 6.5 percent in last two sessions – highest volatility since 2008 market crash.
The market opened at 47,636 points on Thursday, after the previous day’s highest intraday swing, 3.56 percent, since November 2016, when Imran Khan called off PTI’s sit-in and the market swung by 3.76 percent. The trading remained volatile during the initial session on Wednesday when the investors remained sceptical over the most awaited Panama result. However, the panic was waived off by the end of the day and market closed 1.6 percent up.
Shortly after the post-result excitement was settled, the market retracted back to 48,592 points or +988 (at 2:53 pm) but the analysts saw the acceleration as a positive trend that will prevail in the market in coming days.
“The uncertainty is over and I see the market breaching the 50,000 level again, the [investor’s] focus is back on the market who was previously distracted by the political scenarios,” said Adnan Sami Sheikh, an analyst at Topline Securities.
Topline Securities had earlier predicted similar scenario regarding the Panama Case result and its outcome on the market in its analyst report of March 15, 2017, which stated that a JIT is likely to be formed and the market will accelerate up to 1000-2000 points.
Sequentially, Zeeshan Afzal Executive Director Research at Insight Securities said, “Most of the investors expected a positive result and we saw the anticipated excitement too; not for Nawaz Sharif mainly but because the democratic system and current policies have sustained which investors were mainly concerned about.”
He further added, “I see the market breaching 50,000 and settling around that over next few sessions, given that uncertainty regarding budget, economy numbers and MSCI inflows is settled.”
Sheikh on the outlook of coming trading sessions said, “I assume now PM will announce more popular projects before the 2018 election i.e. highways, roads etc. will be constructed more and as that will happen, there will more spending activity and that is good for the local market and the local companies.”