The sentiments on the Lahore Stock Exchange remained unchanged during the last week and equities showed insignificant movement because of scare investors' interest, who have been waiting for good news regarding the bailout package from foreign friends and the donors agencies.
The income of the brokerage houses was badly hit due to investors' absence while mot of the owners, being unable to meet the expenses, have started laying off their staff. Despite persistent sluggishness, the LSE-25 index slightly improved by 1.40 points during the last week and finished at 2831.22 against 2829.82 of previous Friday while transaction volume was substantially restricted to 75,300 shares as compared to previous week's volume of 262,500 shares.
On first trading day, the index fractionally declined by 0.9 points while shares' volume slightly improved to 10,600 shares. No change in sentiments was seen and market kept on moving around the opening level. The Karachi based brokers had sent a set of proposals including closure of the stock exchange for certain period to the Advisor to Prime Minister on Finance Shaukat Tarin. However, no positive response was received to let the market improve.
The brokers who were supporting the proposal of closure of market, like what happened in Korea and Malaysia, were disappointed after the turndown of the proposal. They also wanted availability of substantial liquidity before removal of floor so that market could absorb selling pressure. On first day, only one company showed improvement while 70 companies closed at their previous levels.
On Tuesday, the market slipped by 3.76 points to end at 2825.97 against Monday closing of 2829.73 trading turnover went up to 24,500 shares indicating a selling pressure. The activities remained insignificant as out of 75 companies not a single company closed in green zone while three registered marginal losses. Though, there was news regarding successful visit of Pakistan delegation to USA where it was assured considerable package to provide relief to the country's economy, yet the sentiments remained unchanged.
In experts' view, no change would be seen until the news regarding provision of funds from the donors materialises. The proposal regarding setting up of overseas fund to attract investment in PPL, National Bank and OGDC also failed to induce the investors who had seen the fate of Rs 20-billion Equity Market Opportunity Fund.
The market showed marginal recovery on third day and improved by 5.53 points amid a descending transaction volume that was squeezed to 12,300 shares. Not a single company closed in green zone while investors kept on staying at distance.
On Thursday, depressed sentiments continued and the equities declined amid selling pressure. The index recorded marginal loss of 0.39 points with increase in share volume from 12,300 to 25,300. Selling in D. G. Khan Cement, PIA, National Bank, Southern Electric Power, and Nimir Industries Chemical led the market downward. The last trading day-Friday witnessed lowest ever trading volume reflecting lack of interest on the part of investors. The index shed 0.11 points with trading turnover of 2600 shares. Because of the investors' absence, the brokerage houses were presenting a deserted look. The experts were of the view that the market will show some visible move following removal of floor.
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