April 2, 2003	Wednesday	Muharram 29, 1424

KARACHI, April 1: The Karachi Stock Exchange index of 100 shares (KSE-100) has risen 51.42 per cent between March 31, 2002 and March 31, 2003 which has enabled it to hold on to its position of world’s best performing market, KSE managing director Moin Fudda claimed on Tuesday.

For the calendar year 2002, KSE had outperformed all other global stock markets by posting increase of 112 per cent. In a press release issued on Tuesday, the KSE MD cited data collected from Bloomberg to show that year-on-year (March-to-March 2002-03) the KSE was still ahead of others. The data compared primary equity indices of 10 markets, with KSE in the lead with a rise of 51.42 per cent, followed by Prague Stock Exchange PX50 up by 39.02 per cent; Argentina Merval Index up 33.27 per cent and Mauritius S.E.SEMDEX up 27.14 per cent.

The data provided on Tuesday, did not reveal how the KSE had performed in relation to some important global indices, such as US’ Dow Jones; US’ Nasdaq; Hong Kong’s Hang Seng; Japan’s Nikkie; Singapore’s Strait Times, India’s BSE-30 and UK’s FTSE, but Mr. Fudda told Dawn that the data released on Tuesday was only meant to make comparisons with the greatest rises among global markets. He assured that KSE’s comparison with other major global indices would be released in due course.

In the press release issued on Tuesday, the KSE observed that bulk of investment in the market had come into shares that offered attractive dividends. It stated that any substantial rise in prices would bring down the yields which would in turn lead to technical correction.

“Investors, particularly small ones should take sound advice and avoid over-stretching themselves on the back of badla financing”, Mr. Fudda said. He recalled that during January this year, KSE index had jumped up on account of heavy Carryover transactions (badla) volume and as the badla rates sky-rocketed to 50 per cent, weak and unaware investors were forced to off-load their positions resulting in heavy decline.

Recently, the KSE Board had capped maximum rate of badla at 18 per cent for 30 high volume stocks and 24 per cent for all others. The KSE MD cautioned: “In this regard, investors should be aware that trading excessively in stocks in which badla is running at the capped rate should be done with caution and investors should be especially careful not to over stretch themselves”.