Tense and volatile city situation kept the shares market under pressure on Monday but the overall performance was not disappointing as the KSE-100 index ended with a loss of only 4.93 points.
The market started on a depressing tone and started sliding sharply. The Index lost 42 points at one stage but soon it moved to recover the losses.
Market players were expecting a weak market at the beginning and were anticipating a big decline in the index but the end result was against their analysis.
The market closed at 5497.79 with a net decline of 4.93 points from previous 5502.72 points.
The volume declined from 471.541 million to 366.136 million.
Some experts believed that technical corrections were seen throughout the day. The market was under pressure due to the increase in the rates of PIBs. However, law and order situation was equally responsible for the market's low performance.
The dip in cement stocks was enticing enough for punters to accumulate as tax benefits are expected in the budget. This created a bull-run in second-tier cement stocks with PKCL, ZELP and GWLC closing at their upper limits.
Most of the brokers found it difficult to see the market in positive line at the beginning of the day and adopted cautious approach. The killing of religious scholar Mufti Shamzai on Sunday spread wide-range violence in the city and tension kept strong grip over the city. Though the main markets were open but people restricted themselves to their houses.
"The Sunday incident invited across the board offloading as the delay in federal budget forced the punters to wait for adjusted levels thereby disallowing support around closing levels," said Hasnain Asghar Ali of Aziz Fidahusein & Co.
The index, however, found support and consolidated around 5470-5477 after making a low of 5460 (-42). Institutional buying in the main stocks and punters' rally in the cement stocks invited mild short-covering towards the end, thereby allowing the index to wipe off losses incurred during the day.
Although the market has neutralised from being overbought, the lacklustre movement and widespread activity pushed the intra-day traders on the back foot. The feeling that the PIBs will force institutional offloading and withdrawal of institutional funds from the COT (carryover transactions) market invited mild profit-taking.
The profit-taking was made by individual funds on the view that they might get an advantage of buying back at lower levels.
"Technically, the index will continue to find support around 5470-5477 while the overhead resistance stays at 5533-5539," said Asghar Ali.
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