The Lahore share market rose by 1.34 percent during the week ended on April 6, 2008 with a remarkable improvement in turnover, mainly on investors' growing interest in key scrips following positive news coming from the political front.
The week began on a disappointing note and equities fell 1.14 percent on news that the National Assembly may re-institute probe into March 2005 stocks crisis and US CIA chief's warning of danger at Pak-Afghan border trigged panic selling. However, positive political developments helped equities recover in the subsequent sessions.
Volume also marked a remarkable improvement, which reflected investors' rising interest in the equity market. Analysts said political stability had encouraged both local and foreign investors to return to the market. The US funds, which had taken their stakes out due to law and order problems and political uncertainty in the country, were once again back in the market, an analyst said.
The market performed pretty well during the whole week, gaining 63.79 points to 4,813.90 from 4,770.07 points. Trade volume improved by 18.861 million shares to 38.240 million from 19.379 million shares.
Almost all prime sector scrips made advances during, but oil and energy, insurance sector, cements, securities stocks and partially fertilisers were some of the best performers of the week in question. Except the first session when the market edged down as investors cashed on gains, market performance remained up to the mark in the whole week.
Market players on first day were nervous because of reports saying the National Assembly might reopen inquiry into the 2005 stock market crisis, which deprived the poor investors of huge amounts they had hard earned. Another news that situation in the border region between Pakistan and Afghan presents a 'clear and present' danger to the West also contributed to the negative sentiment, they added. The impact of such news was seen in the market from beginning of the session, while later the market extended the early losses. Since all seems well on the political side, the market outlook in the near term is positive, they further said.
"I think now everyone having stake in the market has the perception that the political situation is getting better and further improvement in it will encourage investors," a broker said. The thing that was most encouraging for the market people was that for the fist time the leadership of all political parties had realised the gravity of the economic and political ills and joined hands, setting aside their past differences to pull the country out of the crises.
The current political situation seems supportive to the market and if stability persists and law and order situation also remains under control, there will be hardly any factor in way of upward thrust of the market, another broker said.
The market people also attached much significance to the PPP Co-chairperson Asif Ali Zardari's meeting with top leadership of the MQM. Both sides announced to bury differences and jointly work for betterment of the country. According to stock analysts, this cooperation was good for the country's betterment and will have very positive impact on political scenario as well as the future outlook of the stock business, he said.
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