Lack of investors' interest on account of confusion over the COT issue kept business activity range-bound on local share market, with the index ending in negative zone and losers beating gainers with a wide margin. The LSE-25 index moved down to 3,560.39 points from 3,603.83 of the previous closing session, registering a net decline of 43.44 points. Volume was also drastically down by 22.242 million shares to 43.483 million from 65.725 million shares.
On the back of news that a mechanism for the margin financing has been devised and a committee headed by a former SBP governor and comprising bankers and brokers has been constituted, the market showed positive signs in early hours with fresh buying in fuel and energy sector. This helped the index gain strength and scale up by 150 points, stockbrokers said. But the trend could not be sustained following selling pressure, which dragged the index in negative zone, they added. PSO, PPL, Nishat Mills, OGDC and banking stocks received fresh losses, while Shell Pakistan and Hinopak Motors ended in positive column.
According to stock analysts, the market depicted volatility and its tone remained highly unpredictable on account of confusion over the issue of COT.
They said that there were conflicting reports over the issue due to which investors' confidence was dull and the market failed to settle down at any stage during the session. They, however, pointed out that investors were upbeat about the corporate results, especially their hopes were high with regard to announcement of the results of the blue chips. But, according to brokers, due to recent crisis investor's confidence is badly shaken therefore their comeback seems impossible until the confusion regarding COT ends.
Javed Iqbal, chief executive of Javed Iqbal Securities Ltd, said the modus operandi for the margin financing had been finalised in a series of meetings chaired by SBP governor on Saturday in Karachi and attended by minister of state for finance, chairman SECP and stock brokers. But investors are confused over the mechanism being devised for the margin financing to replace badla financing, he added. Investor is not accepting the changes being made in the rules and that is why the market is under pressure. He said that investor will take some time to get used to these changes. Hence people are advised to take a cautious approach until the final settlement of the COT issue takes place.
Out of a total of 69 traded scrips, 8 improved their worth, 34 landed in negative column, while 27 were intact at their previous levels. Major gainers were Shell Pakistan, which improved its worth by Rs 27.35, Hinopak Motors Rs 7.15, EFU General Insurance Rs 5.75, Gillette Pakistan Ltd, Rs 2.70 and Adamjee Insurance Rs 1.50. In negative column, PSO shed Rs 24.45, PPL Rs 160.15, Nishat Mills Rs 6.65, Bank of Punjab Rs 5.50 and OGDC Rs 3.40.
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