KSE Boom

13 April 2009 - KSE Index 100 today climbed 255 points to close at 7,872 level. It made a high of 7,908. Effectively, it can be said that KSE Index has now reached the major psychological level of 8,000 mark. Wow! what a success story !

Riding the wave are all those big and small investors who had faith in the Karachi Stock Market and the Government of Pakistan. Well done! returns come with risks and your risks have paid off.

Onwards, as the Index keeps climbing, the risks are also mounting and whilst one must look forward to the 9,000 mark, please incorporate the higher levels of risk in your return calculations. The market needs correction every 700 - 1000 points. I know we just had a small correction associated with Badla decision, but we all know the sharks need excuses and 8,000 might just be what they are looking for! watch out! Again, play well, make money and dont fall prey to these sharks.

Foreign funds keep flowing in and getting invested which is a very positive sign. My strategy for tomorrow is to invest 25% of your funds in medium term growth (up to 3 months) targeting 9,000 points. Trade daily with 50% of your funds. Here you should be able to close your positions at a loss which requires a lot of strength and willpower. everyday you can't win the system. be watchful and use common sense to enter the market, to hold and to exit booking either a profit or a loss. Do not get greedy! As for the remaining 25%, DO NOT INVEST.

Recommendation/ Top Pick Shares: I continue to focus most on NBP. At 106.36 it is closing in for the Target price of 115. In my opinion, one must start to exit/ liquidate positions starting 110 unless you are in for dividend and bonus shares. Today, BOP was a bit of a slow mover. If market goes up by 100 points tomorrow then BOP will surely see a gain of 5%. Another good share is PSO. It has somewhat found resistance at 200 and has struggles to clean break the level. Time is nearing when the 200 mark will be left way behind and the share will scoop the glory of 250.

Trading range for tomorrow: Between 7,725 and 8,025.

Best of luck!