KARACHI, May 18: Stocks on Tuesday fell further on renewed selling by the weak-holders, but unlike the previous session there were buyers at the dips who limited the market decline amid relatively thin trading.

Reports of a strong rebound staged by the Bombay Stock Exchange (BSE) on massive short-covering at the lower levels followed by reports that Manmohan Singh will be the new Indian prime minister instead of Sonia Gandhi. Mr Singh is known for independent economic policies and chief exponent of dominant role for the private sector.

The KSE 100-share index suffered a fresh fall of 24.32 points at 5,388.15 as compared to 5,412.47 a day earlier, reflecting the weakness of OGDCL, PTCL and Hub-Power. Earlier, the echoes of Monday's crash of the BSE dominated the trading here as leading brokerage houses awaited fresh news from across the borders.

"Whether or not foreign fund selling has dried up and fears of the Indian investors about the new government's economic policies are allayed" are some of the questions being debated here.

On the local front, there were more than one positive news on which bulls could have built up strong rally but they too allowed the market to fall further and then to buy at the lower levels.

According to initial reports from the banking sources, the IPO of Bank Al-Falah was heavily oversubscribed, which closed for public subscription on Tuesday. Reports that Dewan Mushtaq group of companies has acquired controlling shares of two cement companies, Saadi Cement and Pakland Cement, was well-received in the market.

The undervalued shares of the two companies have risen sharply during the last couple of weeks after the group started cornering the floating stock. Equally encouraging news was from the fertilizer sector, which reported 50 per cent increase in urea sales and production during the last quarter but investors appears to be worried about the new phase of India-Pakistan relations.

"The market could not fully digest the fallout of the Monday's crash of the BSE as investors could not precisely decide how to react to the tangible political changes in the sub-continent," analyst said.

What worries investors more was the future of India-Pakistan peace offensive, they said, adding "uncertainty will prevail until the new Indian government settles down and announces its future foreign policy.

Minus signs again dominated the list under the lead of Javed Omer, Clariant Pakistan, Lakson Tobacco and Parke-Davis, which suffered fall ranging from Rs7 to Rs25, followed by Shahtaj Sugar, HinoPak Motors, Kohat Cement, Millat Tractors, Thal and Sitara Chemical, off Rs3 to Rs5.

Most of the gains were fractional barring Fauji Fertilizer, Tri-Pack Films, Ghandhara Diesel, Pakistan Oilfields, Ibrahim Fibre, which posted gains of Rs2.75 to Rs4.20, but the largest rise was noted in Siemens Pakistan and Unilever Pakistan, up by Rs13 and Rs25, respectively.

Trading volume fell sharply to 332m shares from the previous 455m shares as leading investors kept to the sidelines awaiting further developments on the Indian bourses. Losers maintained a strong lead over the gainers at 193 to 126, with 40 shares holding on to the last levels.

D.G. Khan Cement topped the list of most actives, off 65 at Rs60.05 on 33m shares, followed by OGDCL, off Rs1.30 at Rs66.35 on 32m shares, Hub-Power, lower by 15 paisa at Rs40.15 on 24m shares, Saadi Cement, whose controlling shares were purchased by the Dewan group, up 30 paisa at Rs15.10 on also on 24m shares and Fauji Cement, easy 30 paisa at Rs16.65 on 23m shares.

Other actives were led by Maple Leaf Cement, easy 60 paisa on 17m shares, PTCL, lower 30 paisa on 16m shares, Pakistan Oilfields, up 4.20 on 15m shares, Lucky Cement, lower 35 paisa on 13m shares and FF Bin Qasim, unchanged on 10m shares.

FORWARD COUNTER: Bank Al-Falah recovered from the previous lows, up 35 paisa at Rs62.10 on 18m shares followed by Hub-Power, higher by 40 paisa at Rs34.55 on active support prompted by reports that repair work on the 4th unit, which developed technical fault is well in progress, on 6m shares, PTCL, lower 35 paisa at Rs42.95 also on 6m shares, FF Bin Qasim, unchanged at Rs19.90 on 3m shares and PSO, up Rs1.15 at Rs267.55 on 2m shares.