The share market sentiment during last week ending on January 14, 2007 improved significantly as the Prime Minister deferred the levy of capital gain tax for a year and the Sindh government deferred stamp duty on transfer of shares for two years.
The KSE-100 index gained 278.10 points, or 2.7 percent, closing the week at 10,425.46 points level and the KSE-30 index at 13,125.42 points level, up by 391.53 points on week-on-week basis.
The market remained bullish during three sessions--on Monday, Tuesday and Friday--but witnessed correction on Wednesday and Thursday.
The average weekly volume was 148.6 million shares against 71.1 million shares of the previous week.
Kurram Ghufran, analyst at KASB Research, said that the KSE-100 index took a technical correction on Wednesday and Thursday, after healthy gains on the first two days of the week on the back of positive developments. The government gave a further boost to the investor sentiment in the second session on Friday by removing stamp duty on electronic transfer of shares. However, though the overall sentiment seems to have improved, falling oil prices (closing at $51/barrel) sounded alarm bells in the investor community and limited the potential upside of the market. In the final analysis, the index closed at 10,425.46 points level.
Ahsan Mehanti, CEO of Shehzad Chamdia Securities, said that the share market performed well as compare to previous week. Trading activity was better as the average ready and future markets volumes rose significantly. He said that the market''s good performance was due to international stock market kicking into gear, capital gains tax exemption extension by a year, country''s economy growing rapidly and local car sales and cement exports were up.
Atif Malik, analyst at Jahangir Siddiqui Research, said that broad based recovery was seen at the market as the index recovered 278 points.
"We believe that in 2007 foreigners would drive the market sentiment, as in the two week of 2007, with market gaining 385 points, we have already seen foreigners dictating the market, since in the first 10 days of 2007 $20 million has been invested in the capital market, while in FY07 to-date a total net inflow of $298 million has been recorded", he said.
On Monday, the market started on a positive note and active buying across the board helped KSE-100 index to cross 10,200 mark to close at 10,235.96 level, up 88.60 points. The intra-day high hit 10,300.55 points level.
The market remained bullish on the second consecutive day on Tuesday with KSE-100 index closing above the 10400 points level at 10405.21, gaining 169.25 points.
The market underwent a correction on Wednesday and took a downturn as KSE-100 index closed at 10374.36 points level, down by 30.85 points. The market opened on a positive note and hit the 10419.80 points intra-day high, but failed to sustain the high levels.
Bearish trend continued at the share market on Thursday and KSE-100 index closed at 10,359.06 points level, down 15.30 points.
Following deferment of stamp duty on electronic share transfer for further two years, announced by the Sindh Government, the bulls took charge at the market on Friday. As a result, the KSE-100 index closed at 10425.46 points level, up by 66.40 points.
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