KARACHI, April 12: The activity on the carryover market is picking up progressively for the second week in a row as investors are not inclined to miss the rising share market and an attractive bait of capital gains.

Analysts said the other contributory factor was the decline in inter-bank repo rates, which again fell to below two per cent, making carryover market more attractive for short-term investment.

However, they don’t expect any major change in the carryover rates (badla), at least for the near-term as the financiers of the carryover business has a massive surplus liquidity at their disposal.

The weighted average carryover rates on the KSE fell to 8.2 per cent from the previous 9 per cent a week earlier as the financing rates in the major scrips, notably PSO, PTCL and Hub-Power were contained in a single digit at 7.1, 5.5 and 6.9 per cent respectively.

But on the other hand investment on the carryover market, over the week, hit the high mark of Rs8.65bn in line with the increase in the volume, which soared to 241m shares.

The investment on the Lahore Stock Exchange showed a slight rise at Rs1.08bn as compared to Rs1.03bn a week earlier. Analysts predict that the investment (both on KSE and LSE) is heading to hit the Rs10bn mark during the next couple of sessions.

However, the figure is far below its previous peak of Rs16bn, attained after the KSE 100-share index breached through the psychological barrier of 2,900 points, analysts said.

Some other analysts at a leading brokerage house predict a significant boost in the carryover market during the coming weeks signalling a major shift in “investor perceptions from Iraq war to the world of corporate earnings and its impact on the share business”.