Stock market remains volatile

Stock market remained volatile last week out of five sessions three were negative and two were positive.
Investors with shorter term perspective were confused their sentiment about the market were changed throughout the week as on every negative close more bearish spell were prophesied but the two positive sessions was enough for mending their dieing hopes, in short optimism and fear lingered Friday''s two trading sessions cast a shadow on mounting hopes but the fact is a sizeable portion still hopes for another bull run shortly.
Long term investors believe that market has potential and if fund placement is based on script fundamentals buy and hold strategy would work. The bench mark KSE-100 index opened at 11,535, Friday closing was at 10,474 all in all three negative sessions shed 1289.01 points and two positive session added 347.92 points given a final tally of minus 941.09 points or 8.2 percent for the week.
On March 06, the KSE-100 index witnessed its biggest decline after May 23rd, 2005, index lost 467.87 points or 4.1 percent on the day optimism after President Bush''s visit shattered and reasoned for the decline, National Bank, PTCL, PPL, OGDC and POL all were in red.
On Tuesday, KSE-100 recovered 138.88 points or 1.3 percent as cement and banking sector led the rally. On Wednesday, the index declined further on news that CBR would soon launch computer programme ''Nexus'' for broadening tax base, National Bank, D.G. Khan Cement and PTCL slashed earlier day gains.
On Thursday, index recovered 205.97 points or 1.9 percent, as CBR''s clarification soothed the market concern and Tuesday''s reason repeated that scripts are at attractive levels. PTCL, MCB, OGDC recovered along with Bank of Punjab which close at its upper circuit at Rs 105.95.
On Friday, KSE-100 slipped three percent or 329 points to close the week at 10,474 level. Oil and Gas sector contributed the most as OGDC, POL and PPL closed down 5 percent on their lower circuits, banking and cement sectors slide as well.
Some considers the move was a "major technical correction" as Alfalah Securities who, while portraying their outlook, in their weekly newsletter''s wrote, "as the index has slipped to attractive levels, we expect the market to witness some support at current levels.
However, the index is expected to consolidate around the 10,200 level, we recommend a gradual accumulation strategy by the investors. Result from the much-awaited National Bank Limited in the coming week might invite speculative interest in the stock."
Khalid Iqbal Siddiqui of InvestCap, wrote "KSE-100 index seems to have lost its sense of direction, as we saw one of the most volatile weeks in the history of the stock trading since the KSE-100 index was introduced in the early 90s.
We believe that with the absence of corporate results, negative sentiments seem to have their foundations laid on political developments, still no official announcement of TAL Block discovery size, reduction in OMCs'' profit margins, and speculative rumours regarding further taxation of stock market investors". He further said, "we believe that fundamentally, few stocks are now providing an opportunity for investment. Investors should continue to focus on fundamentals rather than rumours".