Pak shares pos more gains

The Karachi 100-share index was up 15.52 points or 1.36 percent at 1,155.17 points in late morning trade after climbing more than 5 per cent on Monday. Dealers said the morning buying was inspired by aspeech on Monday night from Sharif, who renewed an offer of peace talks with India to ease tensions created by a two-month military showdown over the disputed Himalayan region of Kashmir.

Naqvi said the tension over Kashmir had damaged Pakistan’s efforts to rehabilitate its economy. "Nobody is watching the economy. In fact, if anything this operation has had a damaging effect," he said. Arshad Arif, research head at First Capital ABN AMRO Equities, said the arrival of an International Monetary Fund mission next month to assess progress on economic reforms would also determine the market’s movement.

"Investors are jittery about Pakistan’s budget targets and will remain away until they actually see an economic recovery taking place," he said. Pakistan has forecast a leap in tax revenue in 1999/2000 (July-June) to Rs 356 billion ($ 6.91 billion), up from an actual 305 billion the previous year. It has also set a 5 percent gross domestic product growth target, up from 3.1 per cent.

Naqvi said a tariff rowbetween Hub Power Company, a market leader on the Karachi Stock Exchange, and state-utility WAPDA would block the market’s rise. Hubco and WAPDA are yet to resume talks on their year-old row over tariffs after a series of talks in May produced no result.