The "best performing stock market in the world" had two crashes within the last 18 months. After each crash an inquiry was ordered but the SECP has still to inform the public about the results. Unless the stock market stables are cleaned up very little foreign investment will come into the country.
One cannot understand why there must be so much fluctuation in share prices even in those of the multinationals. To give just one example Hub Power Co (HUBCO) shares are today trading at Rs 23.75 even after they have been giving Rs 32 to 35 dividends year after year.
Can SECP explain why a share that touched Rs 39 is now at its lowest price? It is unbelievable that every time the share market goes up the price of HUBCO shares goes down. Whether the market goes up or down there is always a transaction of 1 to 1.5 million shares. Even on 2nd December 2005 when the market went up by 145.88 points the HUBCO share went down by 20 paisa although there was a transaction of 823,600 shares. The SECP can easily find out who the buyers and sellers are and who the manipulators are. The rumours are that an investment company is manipulating the prices.
Warning bells are ringing and if the government and the SECP keep on sleeping, the middle class investors and the companies, whose provident funds are invested in HUBCO, will be wiped out.
Is this what the government wants?
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