A bearish sentiment prevailed on the Karachi share market during the week ended on July 15, 2011 due to law and order and political situation in the country. The KSE-100 index lost 43.60 points and closed at 12,346.52 points, with extremely low volumes.
The investors usually sidelined due to their concerns over the law and order and political situation, and the average daily volume at ready counter declined drastically to 40.17 million shares as compared to previous week''s average of 58.39 million shares.
Market capitalisation declined by Rs 12 billion to Rs 3.250 trillion.
On Monday, the market opened under pressure and the index declined by 98.22 points to close at 12,291.90 points with volume of 31.591 million shares.
Bearish trend continued on Tuesday and the index lost 100.12 points to close at 12,191.78 points with 32.212 million shares.
On Wednesday, the investors opted to take fresh positions on dips that supported the index to recover 70.74 points to close at 12,262.52 points with 42.497 million shares.
On Thursday, the index gained 4.81 points and closed at 12,267.33 with 25.316 million shares.
On Friday, the index increased by 79.19 points and closed the week at 12,346.52 points with 69.234 million shares.
"Due to violence in the major financial hub of the country, coupled with political sizzling the KSE-100 index felt bearish sentiment in the week", Yawar-uz-Zaman, an analyst at InvestCap said.
At the same time, pressure from foreign front continued as the relations between the United States and Pakistan took a turn for worse since US stopped its military aid of $800 million to Pakistan, he added. However, USA conformed to continue its civilian support in the future.
Bilal Qamar at JS Global Capital said that the week started on a wrong foot as the US withheld its $800 million military aid to Pakistan which dented investor confidence early on. To add to it, the week was marred by poor law and order situation, particularly in Karachi, after a fiery comments made by a provincial minister.
Investor sentiment was further dampened by the country wide protests called by MQM on fiery comments made by a provincial minister. Nonetheless, some scrip-wise activity was witnessed, especially in the fertiliser sector as Engro increased urea prices by Rs 125 per bag with, FFC and FFBL expected to follow suite. The Chemical sector consequently gained 2 percent during the week.