Downward trend continued on the Lahore Stock Exchange (LSE) for the second consecutive session on account of profit-taking in key chips, especially in petroleum stocks, which forced the index to close in negative zone.
The LSE-25 index moved down by 50.24 points or 1.32 percent to finish at 3744.26 points as against 3794.50 points of Tuesday, while the volume increased to 68.070 million shares from 40.913 million of the previous session, registering a surge of 27.156 million shares.
The market opened with a healthy note with encouraging buying activity in petroleum shares, but soon fell prey to selling pressure, as majority of the players took to off-loading, which led the index in the negative zone.
ICI Pakistan, Union Bank and Nishat Mills showed improvement, but failed to change the overall sentiment of the market. The petroleum sector was the most hit scrip, with PPL receiving a heavy loss. PSO also showed downward slide followed by banking stocks. The cement sector, showing upward movement during the last session on the back of increase in its prices, also failed to maintain its overnight bullish trend.
After receiving battering for two consecutive sessions, the market may take a turn on Thursday, as the existing levels, which are attractive might lure investors and people might see good trading during the session, a broker said. However, any negative news could affect the sentiment, he added.
Javed Iqbal, chief executive of Javed Iqbal Securities Ltd, said that after previous days depreciation, the market sentiment changed on Wednesday, and it took a positive start, which raised hopes of people for a good session. However, later the market came under pressure because of heavy selling in PPL and other oil sector shares, moving the index down by 100 points, he added.
In last minutes, the recovery took place, but overall sentiment remained bearish and the index ended in the negative column, he said.
He was of the view that auction of treasury bills was the key factor leading to selling pressure. The investors apprehended liquidity crunch and shed positions in a panic. The talk of settlement of futures trading for June was also a disturbing factor having a bad impact on the sentiment, he pointed out.
Though there is no negative news from political or economic front and there are also positive reports of the privatisation of PSO, yet phasing out of badla and confusion over the issue of margin financing could disturb the market, Javed Iqbal said. The banks are not getting involved in margin financing and the investors are confused, said, adding that banks are reluctant to finance individual investors, which remains to be a major concern.
Out of a total of 82 traded scrips, three improved their worth, 31 landed in negative column, while 48 stayed intact to its previous levels.
Among major gainers, ICI was up 90 paisa, Union Bank 25 paisa, and Nishat Mills 5 paisa.
In negative column, PPL was down Rs 7.40, DG Khan Cement and PSO Rs 2.10 each, National Bank and Fauji Fertiliser Rs 1.95 each.
PSO was the volume leader with 16.046 million turnover followed by DG Khan Cement with 5.620 million shares.
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