THE stock market finished the Eid-holiday shortened week on an insipid note as investors again kept to the sidelines pushing the volume to a new all-time single session low below a million share mark at 0.985m shares.

The investors were, however, a bit happy as they were saved by the negative fallout of fresh plunge of world equity and financial markets after the US Congress rejected the $700 billion bailout package by Bush to restore sanity to the falling markets.

The market was in terribly sluggish mood as was evident from the fractional downward changes for the eight week in a row in the KSE 100-share index, which was finally quoted at 9,179.68 points, off 4.47 points.

“The economy is a victim of the aftermath of global inflation and financial crisis coupled with internal instability caused by rising militancy”, said a leading stock analyst adding “only major policy decisions will correct the situation”.

A loud talk of an economic bailout package of about $15 billion by the Friends of Pakistan group, which is expected to meet in Dubai next month to finalise funding arrangements, did not enthuse investors as no one was ready to go that far, viewed in the prevailing law and order situation in the country, analysts said.

In this context assurances being given to inject liquidity in the system by foreign donors also failed to have a positive impact on the market as was reflected by falling volumes, they added.

It was another week of low daily volumes on the premier bourse as investors were not inclined to go beyond their pre-determined limits owing to prevailing law and order situation in the backdrop of suicide attack on the Islamabad Marriott Hotel and disturbing news about Fata operations.

Although opinions on the floor on the KSE 100-share index are divided, some say it should be removed immediately, while others oppose it and argue that in the prevailing situation, both on the economic and political fronts it should stay for some time.

But a KSE review meeting, held on the issue on Sept 25, decided to keep it in place for some time. A decision in this regard may be taken by next month.

Floor brokers said some leading foreign investors are trying to get it removed so that they could exit even with fresh losses, leaving the market in the hands of speculative traders, who could play with the savings of small investors.

The downgrading of Pakistani bonds and banks to negative from positive did not have any immediate impact on their shares as the market is overawed by so many other local negative factors, floor brokers said.

One thing is apparent that many investors, notably foreigners, may not re-enter the market at this stage and will wait for the return of normalcy both on the economic and political fronts.

Trading, thus resumed on a cheerless note amid fears of more suicide attacks in the backdrop of attack on Islamabad Marriott and reports of heavy death toll.

“Investors are eyeing the review of flooring on the index before making their fresh buying strategy”, said a leading analyst Tabish H. Rajabali adding “they are more worried over the official apathy on the issue and its further extension after the Eid holidays”.

He said the turmoil on the global markets was controlled a bit after the US launched $3 trillion rescue package but its after- effect would continue to haunt investors in the many weeks to come.

Analyst Ahsan Mehanti said the continued weakness of the rupee was a double-edged weapon which was taking its toll in the share market, but what worried the investors was that there was no visible official effort to stabilise it at a viable level.

Dividend news from the textile sector though was on the lower side, it indicates that the performance of this sector of economy is fairly encouraging despite reports of a short crop and higher lint prices. On the other side, the auto shares and some others came out with higher payouts.

Forward counters: Trading on the cleared list also remained insipid as investors were not inclined to go beyond certain price limits and played within them on modest two-way activity.

Millat Tractors, Al-Ghazi Tractors, Engro Chemical, MCB Bank Alfalah, Hub Power and some other came in for alternate bouts of buying and selling on small margins and mostly ended around the previous levels.—Muhammad Aslam.