Stock market stays bearish

Bearish trend prevailed at Karachi share market during the week ended on September 13, 2008 and KSE-100 index declined by 88.27 points to close at 9,253.92 points level.
The market witnessed dull activity and the average daily volume of ready market declined to 21 million shares as compared to previous week's average of 22.776 million shares. The average daily turnover of futures market, however, increased to 2.279 million shares against last week's average of 1.774 million shares.
Market capitalisation declined by Rs 35 billion to Rs 2.886 trillion. The market remained under pressure from the first day of the week and the KSE-100 index lost 45.96 points to close at 9,296.23 points on Monday.
Same trend continued and the index declined by 16.61 points to close at 9,279.62 points on Tuesday.
On Wednesday, the market witnessed fresh buying due to announcement of shares buyback by OGDC and NBP and the index rose by 36.06 points to 9,315.68 points. The market witnessed bearish trend on Thursday and the index lost 52.29 points to close at 9,263.39 points level.
The index lost another 9.47 points to close and finally settled at 9,253.92 points level on Friday.
Farhan Mahmood, an analyst at JS Global Capital said that selling pressure was witnessed throughout the week except Wednesday when some activity was observed in NBP and OGDC on the news that its management would buy back shares. However, with no clue on the price and size regarding such buyback, investors were hesitant to enter the market.
He said that foreign selling was at heart of recent fall in local equities. During the week, $4.4 million foreign selling was recorded. This was mainly due to dwindling exchange rate and lower FDI flows. Moreover, widening trade deficit for July-August 2008 at $3.5 billion (48 percent higher than last year) also created concerns, he added.
Regarding outflows from emerging markets, Farhan said, despite 4 percent decline in oil prices in the international market, MSCI EM Asia went down by 2 percent as financial sector concerns and worsening global growth amid weak US jobless data continued to hamper investors' confidence.