LSE ignores negative factors

Giving little weightage to political developments taking place after the resignations of MQM ministers and mounting pressure of opposition parties on the government, the share market remained in bullish zone, with some improvement in volume, ending last week proceedings with a net gain of 1.59 percent.
The market opened the week on a positive note and moved in plus column in the following sessions on the back of rising trend in petroleum products in the international market and excitement for the corporate announcements season. Oil and bank scrips were in the leading positions with the former giving an outstanding performance because of investors' high hopes regarding results of the entire oil and gas sector, analysts said. The LSE-25 index mounted to 4,596.62 points from 4,524.41, registering an increment of 72.21 points.
Turnover was also better, surging to 42.181 million shares from 39.902 million shares of the preceding week.
According analysts, the market discounted the impact of SBP move to increase SLR and CRR and the ongoing inquiries into the causes of market crash, and even the political situation arising out of MQM resignations. The market was on the path of recovery if no other negative development took place, they added.
The market commenced the week on a bullish note and share prices edged higher with fresh buying emerging in Adamjee Insurance, some key banks and partly in oil and gas sector, which jacked the market by 1.28 percent. The LSE-25 index closed at 4,582.63 points compared with 4,524.41, recording a net gain of 58.22 points.
Volume was slightly down at 36.117 million shares as opposed to 39.902 million, depicting a decline of 3.785 million shares. The market subsequently performed smoothly with OGDC setting the trend followed by other scrips in petroleum, banking and cement sectors. Selling pressure surfaced in second half of the session, but mostly the market performed evenly. Volume, however, was a bit low as compared to the preceding session, which meant that the market lacked investors' interest.
On Tuesday, the market depicted a mixed trend and in the early hours share prices eroded due to profit-taking by institutions, but eventually ended in the positive zone. The LSE-25 index improved by 54.52 points to 4,637.15 from 4,582.63 while turnover ascended to 40.649 million shares from 36.117 million shares.
Bearish trend prevailed on Wednesday and equities registered across the board losses amid declining volume. The LSE-index shed 47.72 points to 4,589.43 points from 4,637.15, whereas turnover squeezed to 29.490 million shares from 40.649 million. Oil sector giants OGDC and PPL and National Bank, Askari Commercial Bank and Bank of Punjab were hit by pressure while cements resisted the decline.
Led by oil and gas sector, equities recorded across the board gains on Thursday and LSE index gained 35.20 points to 4,624.63 points from 4,589.43.
Turnover moved up to 42.034 million shares from 29.49 million shares.
Share prices depicted easy trend on the last day of the week. However, losses were limited because of strength in the oil sector, which performed fairly well. The LSE-25 index lost 28.01 points to finish at 4,596.62 versus 4,624.63. Overall turnover was almost flat at 42.181 million shares as compared to 42.034 million shares. The market moved in a narrow range and there was a fractional improvement in turnover, which showed lack of interest, especially the involvement of potential investors.
However, despite overall range-bound activity, oil and gas sector, and to some extent banks, delivered well and showed strength. PSO and PPL outperformed and gained handsomely despite the weekend pressure. On losers' end, Honda Atlas Cars and Engro Chemical were the key sufferers.
Except one or two sessions, when activity was range-bound, the market played well with a good movement in banks, oil and gas sector and banks.
Analysts said that overall sentiment remained bullish, despite many negative factors. The most significant factor that encouraged buying was the corporate results season. Market players were upbeat about the companies' announcements, especially for the oil and gas sector.
But people were also advised to adopt a cautious approach and avoid going beyond their capacity as situation in Lebanon could change the scenario the world over, which would also have an impact on the market.