March 03, 2008	Monday	Safar 24, 1429

THE share market last week failed to establish any set price pattern as investors played on both sides of the fence indulging in alternate bouts of buying and selling followed by positive and negative news on the political front.

However, the notable feature of the week was that the KSE 100-share index managed to cross its coveted level of 15,000 points on the strength of higher dividend and strong performance by leading base shares under the lead of National Bank, MCB, OGDC, Bank Alfalah, Habib Bank and some others.

The underlying sentiment also remained uppishly inclined on the strength of higher cash dividend and bonus shares by banks and other companies.

The KSE 100-share index, after showing either way movements throughout the last week, finally settled below the all-time high level of 15,000 on the strength of better performance of the leading base shares.

It finished the week at 14,934.30, off 46.36 points compared to last week’s 14,980.66 on late weekend selling. The free float 30-share also fell by 19.80 points at 18,367.29 points.

The breakthrough came after the coalition partners showed a numerical strength of 171 MNAs enough to form a government at the centre and the provinces.

The next week could be crucial for future direction of the market as indications are that the national assembly may be in session and its negative and positive fallout will be visible in the market stance, floor brokers said.

“The talk of two-thirds majority in the parliament now appears to be a possibility, but how the new parliament views it, will be seen after the inaugural session of the assembly, analysts said.

The agenda of the new parliament, notably restoration of the superior judiciary and removal of section 58(2)b, under which the president holds power to dissolve the assembly, may lead to a standoff between the contenders of power, some analysts fear.

But the positive developments on political front, mainly the resolve of the would-be coalition partners to stabilise democracy, did create a sense of optimism among leading investors on the perception of smooth sailing on the political front, they said.

Though reports about the president’s safe exit were denied, a section of investors were still in two minds to stay or not to stay in the buying arena, analysts said.

“There may be a brief interruption in the market’s current stance even if the president decides to leave the scene”, said a leading analyst. “The market has attained a sustainable level and it would be difficult to pull it down by negative developments on the political front”, he added.

The perception of stable future governments both at the centre and provinces could keep the market’s sailing smooth despite the fact that economic problems, including inflation and deficit financing would need an extra effort to put the economy back on the rails, some others said.

The market’s early optimism over political stability was well reflected in its run-up as the KSE 100-share index virtually raced to a high of above 15,150 points, and indications were that it may set new records.

While leading base shares in the banking sector maintained their upward drive under the lead of National Bank, MCB, and Bank of Punjab, the weakness of the oil shares weighed against the underlying sentiment, said a floor broker.

Some others said board meetings of some leading companies were due during the next couple of sessions, which could keep investors in a positive mood. And what occurs after the current euphoria ends would reflect the market’s future trend, he said.

Forward counter: Barring Bank of Punjab which announced a bonus share of 25 per cent, and some others which came in for late selling and finished lower, others including National Bank, Engro Chemical, OGDC, Pakistan Oilfields, PTCL and Fauji Fertiliser Bin Qasim managed to close on the higher side.—Muhammad Aslam