Share prices soared on Lahore Stock Exchange (LSE) last week, gaining 2.68 percent with aggressive buying in oil and gas exploration, banks and cements sectors despite a number of negative factors such as increase in SLR and CRR by State Bank of Pakistan and levy of stamp duty on CDC transactions of shares.
The market opened the week on depressed note following profit-taking and, according to brokers, to some extent on account of worries over law and order situation, coupled with statements of Indian government accusing Pakistan of Mumbai train blasts.
However, later in the week the market stayed in positive zone, but the activity slowed down as factors like raise in banks' SLR and CRR by SBP and levy of 0.1 percent stamp duty on e-transactions of stocks by the Government of Sindh. Market players' reaction to imposition of stamp duty was although negative, but it did not have much impact on the sentiment as hopes of good results in corporate sector kept investors' interest intact in the market, a broker said, adding the corporate result season might not allow bears to stage a comeback till such time as the companies' results would keep pouring in.
Overall activity was range-bound but the sentiment stayed bullish during the week. The LSE-25 index rose to 4,524.41 points from 4,406.28, registering an increment of 118.13 points or 2.68 percent. Volume surged to 39.902 million shares from 38.724 million shares, posting a slight rise of 1.178 million shares.
Share prices tumbled on Monday following profit-taking and worries regarding law order situation as well as change in Indian government's attitude toward Pakistan after Mumbai train blasts. The LSE-25 index lost 61.64 points or 1.39 percent closing at 4,344.64 as compared to 4,406.28. Turnover retreated to 35.249 million shares from 38.728 million shares, registering a fall of 3.479 million shares or 9 percent. The market was nervous initially and due to profit-taking in key banks and oil & gas sector shares, the index moved down but later recovery took place enabling the index to recoup a sizeable chunk of early losses.
In banking sector, National Bank and in oil sector, PSO were the top losers while D G Khan Cement and Engro Chemical delivered well and strengthened their positions. Bullish trend prevailed on second day of the week under review with equities registering across the board gains amid ascending transaction volume on account of fresh buying by the institutions. The LSE-25 index improved by 139.08 points, closing at 4,483.72 against 4,344.64, while trading turnover increased to 48.912 million shares as compared to 35.249 million shares. Oil and banking sectors helped the market gain while cement sector remained depressed. Share values moved both ways on the third day, but finally ended with a positive note due to hectic buying in petroleum sector which, led by PSO, outperformed. The LSE-25 index finished at 4,494.37 points compared with 4,483.72, registering a marginal increment of 10.65 points. Volume also showed improvement reaching 58.051 million shares as against 48.912 million shares. The market took a disappointing start and gradually lost strength because of pressure in banks following the news regarding State Bank move to enhance the CRR and SLR. SO and Pakistan Oilfields were the day's major gainers while Faysal Bank and Union Bank were the prominent losers.
The market against painted a mixed picture on second last day of the week but finally settled in negative zone amid ascending transaction volume on account selling pressure in oil sector. The LSE-25 index marginally declined by 15.75 points, closing at 4,476.62 against 4,494.37. Turnover increased to 67.029 million shares as compared to 58.051 million shares. MCB Bank, DG Khan Cement, Picic and Adamjee Insurance resisted the selling pressure while PSO, PPL, National Bank and OGDC shed their values.
The market opened on a healthy note and kept moving upward throughout the day. However, during last hour, the sentiment could not remain intact and selling pressure emerged, which dragged it to the red zone. Institutions and investors' interest in oil, banking, fertiliser and cement sectors provided support to the market which gained about 155 points at one time during the day but started melting due to profit taking. Share values were range-bound on last trading day of the week.
However, buying in oil and gas sector helped the index gain one percent. The LSE-25 index ended at 4,524.41 points as compared to 4,478.62, registering an increment of 45.79. Volume ascended to 39.902 million shares from 67.029 million, falling by 27.127 million shares.
According to an analyst, the market discounted all negative factors, including law and order problem, Mumbai train blasts and imposition of stamp duty on electronic transitions of shares because of two reasons. Firstly, they pointed out, due to investors' high expectations about corporate results for the June closings, and secondly due to foreign investors' growing interest in exploration sector.
They said that fresh interest of foreign investors was visible in PPL during the week, due to which, its share improved its worth sizeably. The State Bank's move to allow foreign investors to trade in futures was another key factor for increase in foreign investment in the market, especially in exploration sector.