IT was the leanest trading week ever witnessed on the Karachi Stock Exchange both in terms of single session daily volumes, which hit an all time low of 4.309 million shares, and fractional price changes, what the analysts called a silent protest against the flooring of the index by the minority investors.

There is a loud whispering that a section of the leading foreign investors is indulging in off-the-floor transactions because of the price freeze and is inclined to get out of the market to meet its financial demands in other markets after the global turmoil in the backdrop of the Lehman bankruptcy.

The KSE 100-share index maintained its creeping decline as investors played on both sides of the fence and did not take long positions on any of the counters even at an attractively lower level apparently awaiting some miracle to happen for market recovery.

The Benchmark KSE 100-share index suffered a fresh pruning of 53.32 points at 9,200.60 points at as compared to 9,253.92 a week earlier, reflecting the weakness of leading base shares, notably MCB, OGDC, Engro Chemical and some others.

Some say a formidable section of investors is waiting the lifting of price freeze and floor on the KSE 100-share index, to re-enter the market with a new portfolio strategy in the changed background news after incursions by the US inside Pakistan and killing people by missile attack.

But some others believe the market could fall further from the current levels after curbs were lifted as the news both from the economic and political fronts were not that encouraging. However, institutional support at the current attractively lower levels could put the market back on the rails after a brief bearish spell.

“Leading bulls and bears seem to have got tired by now because of the new trading rules and limitations and are inclined to fight grim battles after they are freed from the current curbs and may make or mar the market”, analyst Tabish H. Rajabali thinks.

The bear onslaught on the rupee owing to heavy demand for the US dollar, week economy, rising fiscal trade deficit and inflation did worry investors who think twice before putting money in stocks, he said.

“But we may not be at war with the US in the tribal areas, the air raids from across the borders do worry any prospective investors”, analyst Ashraf Zakaria said.

The stock market passed through another terribly lean trading week as leading investors kept to the sidelines awaiting the advent of fund buying to stimulate sympathetic support from other quarters, but institutional traders remained conspicuous by their absence.

The negative fallout of the bankruptcy of a leading US investment bank, the Lehman Brothers, echoed in the market but failed to have any negative impact on trading as investors have some other pressing worries both on economic and political fronts, analyst Ahsan Mehanti said.

The current thaw in the Pakistan-US relations on Fata incursions was viewed by investors a negative development amid fears that it could take an ugly turn any moment in the backdrop of rigid positions taken by both, stock analyst Tabish H.Rajabali said.

Analyst Hasnain Asghar Ali said the buyback of floating stock by the National Bank and OGDC managements were a positive news for the ailing market but the lengthy process of about two months seems to have disappointed investors.

“The decision to mop up the free float came at a time when the market needed positive news to boost the investor morale and it did evoke modest buying initially. But the lengthy process kept them away to make covering purchasing at the current level of Rs93 ”, he added.

There is a loud whispering in the market that a strong group of leading brokers is mooting an idea to set up a private equity fund, to absorb both the local and foreign free float at the current levels to restore sanity to stock trading, he adds.

All eyes are now set on Sept 25, when the KSE high-ups would review the current price freeze and the KSE 100-share index under floor. Whether to extend the freeze or remove it to free the market from official curbs would be known on Sept 25, some others said.

Forward counter: Speculative issues on the forward counter also followed the lead of their counterparts in the ready section and generally fell where changed, major losers among them being Engro Chemical, PTCL, Hub Power and some others. But many others, including National Bank and

Fauji Fertiliser were held unchanged at previous levels.

—Muhammad Aslam