Bearish trend was witnessed at the share market throughout the week ended on November 25, 2011 and the KSE-100 index lost 289.67 points, or 2.4 percent, to close at 11,648.14 points. Trading also remained very low and the average daily volume at ready counter declined by 17.2 percent to 34.40 million shares as compared to previous week's 41.54 million shares.
Market capitalisation declined by Rs 72 billion to Rs 3.032 trillion. Foreign investors remained on the selling side and withdrew $3.8 million from the equity market, against a net outflow of $1.3 million recorded in the previous week.
On Monday, the market opened under pressure and the index lost 43.02 points to close at 11,894.79 points with total volume of 31.097 million shares.
Bearish trend was witnessed on Tuesday and the index declined by 127.79 points to close at 11,767.00 points with 28.368 million shares. This trend continued on Wednesday and the index lost another 133.03 points to close at 11,633.97 points with 33.565 million shares.
The index on Thursday recovered 95.44 points on the back of investors' interest on dips and closed at 11,729.41 points with improved volumes of 50.796 million shares.
However, the investors once again opted for selling on Friday and the index lost 81.27 points to close the week at 11,648.14 points with 28.176 million shares.
Yawar Uz Zaman, an analyst at InvestCap said that another dull week was witnessed at the KSE, where both values and volumes continued to shrink owing to absence of triggers in the market. The investors feared to take any interest in the market and waited for positive developments that could pull the market through current notorious levels.
He said that the market throughout the week closed in the red except the second last day of trading, during which some recovery was seen.
On economic front, massive rise of 54 percent on year-on-year basis in the country's oil import bill was witnessed mainly due to rise in international oil prices that pushed current account in to deficit of $1.56 billion during first four months of FY12. As far as market return is concerned, KSE-100 index stood with a negative return of 1.01 percent year-to-date (5.2 percent on year-on-year basis) amid concerns over CGT's return filing, in addition to the increased noise on political front in the country.
Furthermore, IMF also raised concerns over Pak economic outlook and predicted FY12 as being another low-growth year amid fiscal and external imbalances, though inflation was projected to decline this year.
Naveed Tehsin at JS Global Capital said that lacklustre activity was witnessed at the local bourse amid the uncertainty surrounding the Pakistan's Ambassador to the US and expectations of status quo in the upcoming monetary policy on Nov 30.
The IMF has shown concerns over macro economic indicators and sees a 'challenging' outlook for Pakistan due to pressures on the fiscal side, debt servicing and energy crisis. Moreover, the IMF has projected Pakistan's real GDP growth at 3.5 percent in FY12 against 4.2 percent projected in the budget.
Furthermore, the government has raised the wheat support price to Rs 1,050 per 40 kg from Rs 950 previously. It is expected to bode well for the fertilizer offtake in the ongoing Rabi season and may result in enhanced auto sales due to expected rise in farmers' income.