Index loses 222 points

Bearish trend was witnessed at the Karachi share market during the week ended on January 6, 2012, and the KSE-100 index declined by 222.31 points to close at 11,125.35 points. Trading, however, improved and the average daily volume increased by 10.9 percent to 42.21 million shares as compared to previous week''s 38.06 million shares.
Market capitalisation declined by Rs 52 billion to Rs 2.893 trillion. Foreign investors remained net sellers and withdrew $6.7 million from the equity market as compared to the outflow of $0.42 million in the previous week.
On Monday, the market opened under pressure and the index lost 65.65 points to close at 11,282.01 points with 33.167 million shares trading.
On Tuesday, investors'' interest in some select stocks supported the index to register a healthy increase of 120.03 points to close at 11,402.04 points with 63.047 million shares. On Wednesday, the market witnessed declining trend and the index lost 40.07 points to close at 11,361.97 points with 46.131 million shares.
On Thursday also, the market witnessed bearish session and the index declined by 174.09 points to close at 11,187.88 points with 29.638 million shares.
On Friday, the index lost 62.53 points to close at 11,125.35 points with 39.043 million shares.
Yawar Uz Zaman, analyst at InvestCap, said that the very first week of CY12 did not bring any excitement for the investors to keep them attracted towards equity market. The index declined by 2 percent on account of continued foreign selling and re-emergence of shadows on political front. Meanwhile, US froze $700 million aid to Pakistan which can also be blamed for the negativity surrounding. CPI for the month of December 2011 clocked at 9.75 percent on year-on-year basis which surprised the market, and provided hope for monetary easing, though fiscal challenges and rupee depreciation against the green back remains a source of concern for the policy makers. Rupee touched record low of Rs 90.60 in inter-bank market. At the same time, SECP and revenue collection authority again failed to come up with a solution to boost volume at the stock exchange. During the last day of the week, Engro Corporation once again raised urea price by Rs 181/bag (excluding GST) due to imposition of gas infrastructural development surcharge.
Naveed Tehsin at JS Global Capital said that investors at the bourse remained bearish throughout the week. Downward revision in National Savings Schemes (NSS) rates (up to 84bps) coupled with Consumer Price Index (CPI) for December 2011 clocking in at 9.75 percent failed to counter the negativity of the ongoing political uncertainty together with the imposition of Gas Infrastructure Development Cess (GIDC) and gas tariff hike. Towards the end of the week, Engro raised urea prices but this, too, could not change the bearish sentiment of the market. KSE 100 Index lost 222 points.