LSE registers more losses

The bearish onslaught continued to mar trade activity for the third straight session on Lahore Stock Exchange (LSE), where equities, led by oil and gas sector, nose-dived bringing the market down by 3.41 percent.
The LSE-25 index finished at 4666.84 points versus 4831.98 of Tuesday, registering a net loss of 165.14 points or 3.41percent. Volume also declined by 11.290 million shares or 23 percent to 37.480 million from previous day's 48.771 million shares.
The market start was weak and then it remained under bearish wave prevailed following capped CNF, rumours about doubling of margins for ready market, declining oil prices in the international market, as well as situation developing in the country after Bajour Agency incident, in which more than 80 people were killed, analysts said. Petroleum sector was worst-hit sector, which underwent heavy battering under the lead of PSO and Pakistan Oilfields, which received massive losses, they added. However, despite overall depressed sentiment, some banking sector scrips, such as MCB Bank, Pakistan Industrial Credit and Prime Commercial Bank registered fresh gains and ended in positive zone.
According to Mirza Muhammad Irfan of Capital Vision Securities, rumours regarding 100 percent increase in margin for ready market and phasing out of in-house badla from tomorrow were the two basic factors for the ongoing bearish spell.
According to him, there was a strong rumour on Wednesday that margin for ready market was being doubled which caused pressure in the market, he added. "Our regulators are trying to regulate ready market by futures, which is against the world practice. In other countries, futures regulate ready markets, but we have a practice that is nowhere in the world."
About Bajour Agency incident, he said although brokers had concerns over it, but its impact was minimal on the market. "As we have seen in past, impact of such types of incidents is for a shorter term. As a matter for fact the current bearish wave is due to internal factors, he asserted.
Another factor is disappointing first quarter results of PSO, he said, adding, the company's EPS for the said period comes to Rs 3.30, which is far below the previous year's. PSO, which led the minus column, set the trend on Wednesday and subsequently all key oil and gas sector shares declined followed by banks and cements, Irfan pointed out. He said that a number of big chips on Wednesday reached their lower circuit breakers, including PSO, Lucky Cement, Pioneer Cement, SSGC, SNGPL.
PPL and National Bank also closed to their lower cap limits. When asked how the market will behave in the coming sessions, he said it has undergone a wide-ranging correction of 364 points in three sessions, and if all internal issues are resolved, it could pick up from the current level, he said.
In all, 113 scrips changed hands, of which 14 improved in worth, 41 stayed in minus zone while 58 were intact to their previous levels. In positive zone, MCB Bank improved by Rs 2.50, Pakistan Industrial Credit Rs 2.30, Prime Commercial Bank Rs 1.35, Fauji Fertiliser Rs 1.20 and Kohat Cement Rs 0.90. Major decliners were PSO, which lost Rs 12.40, Pakistan Oilfields Rs 11.25, PPL Rs 9.50, National Bank Rs 7.50 and OGDC Rs 5.25. Bank Alfalah and National Bank were the volume leaders with 7.435 million shares and 3.735 million shares, respectively.