KARACHI, June 8: Stocks on Wednesday failed to extend the overnight run up as follow-up support turned shy amid conflicting rumours, which followed in quick succession never allowing investors to take positions even on selected counters. The KSE 100-share index shed 128 points at 7,263.56.

The performance of the market was highly erratic as each rise followed by snap reversal as leading brokers played on both sides of the fence influenced apparently by the rumours.

But the mid-session rumour originating from Lahore about the resignation of the prime minister, just after two days of presenting a good budget, created panic-like conditions on the market followed by hasty selling in some of the blue chips and leading shares.

However, the market digested the rumour as a section of leading investors made active short-covering at the lower levels on the assumption that the rumour may have been spread by some of the vested interests for obvious reasons.

The KSE 100-share index opened lower on reports that 10 per cent tax has been imposed on the brokers but soon recovered from the low after fluctuating 50 points either-way.

Steep increase in the trading volume to 482m shares from the previous 304m shares reflects the panic among the leading investors and brokers.

However, the rumour about the prime minister’s resignation triggered panic- selling, pushing the index down by 127.62 points at 7,263.56, reflecting the weakness of the leading base shares, notably PTCL, OGDC, PSO and PPL.

But some others said the rumour has been spread by some vested interests to overshadow the positive impact of the fiscal measures announced in the budget for both the industry and bourses.

The post-budget halt in market’s upward trend worried investors and they feared other negative news may follow to destabilize the market.

The market decline was again led by the leading oil shares, which attracted heavy selling at the overnight higher levels followed by other pivotals including the chief beneficiaries of the budgetary incentives including textiles, banks and fertilizer.

But on the other hand insurance shares continued to derive strength from the capital gains tax exemption and rose further amid active trading.

Although gainers trailed far behind the losers, some of them managed to post good gains under the lead of EFU General Central Insurance, IGI, Javed Omer, Artistic Denim, and Siemens Pakistan, up by Rs6 to Rs30.

Losers were led by Arif Habib Securities, Pakistan Oilfields, Aventis, PSO, National Refinery, Shell Pakistan, and Parke-Davis, off Rs5 to Rs33.

Trading volume rose to 482m as losers forced a strong lead over the gainers at 172 to 105, with 37 shares holding on to the last levels.

The most active list was topped by PTCL, easy 60 paisa at Rs66.50 on 195m shares followed by OGDC, off Rs3.35 at Rs102.60 on 126m shares, National Bank, down Rs2.25 at Rs98.80 on 32m shares, Pakistan Petroleum, off Rs4.40 at Rs195.90 on 31m shares and PSO, lower Rs8.55 at Rs363.50 on 17m shares.

Other actives included D.G. Khan Cement, off Rs2.10 on 15m shares, Pakistan Oilfields, lower by Rs6.10 on 8m shares, Fauji Fertilizer Bin Qasim, easy 20 paisa also on 8m shares, Nishat Mills, up by 40 paisa on 7m shares and MCB, higher by Rs1.25 on 6m shares.

FORWARD COUNTER: Speculative issues on the cleared list also followed the lead of their counterparts in the ready section and generally fell where changed on active profit-selling. Pakistan Petroleum was leading among them, off Rs3.60 at Rs198.50 on 30m shares followed by OGDC, lower Rs2.15 at Rs102.75 on 24m shares and PTCL, lower 65 paisa at Rs66.95 on 21m shares.