THE share market last week managed to finish well above the midweek lows as a section of leading institutional traders covered positions at the attractive lower level aided by the perception that the worst may be over.

But the absence of some leading foreign investors was felt as they did not resume covering operations apparently awaiting further developments on political and legal fronts.

However, it was a week of fluctuating fortunes amid highly volatile and erratic price movements under the cross current of negative and positive news, but in the final analysis bears held the fort and kept bulls away from their recently attained position.

What seemed to have taken steam out of the rising market were rumours about the imposition of martial law or emergency ahead of the apex court ruling on the president’s eligibility to seek reelection for the second term. The KSE 100-share index crashed from the recent highs and ended the week at 13,915.04, off 534.94 points, wiping out about Rs155 billion from the market capital.

Leading investors, including institutional traders, who had been bullish even in the backdrop of disturbing background news including law and order situation in Swat and suicide attacks in high security areas, at last gave in followed by rumours of martial law.

“Martial law or emergence may not be around, but speculative forces made it look so followed by panic selling and heavy fall on the blue chip counters”, analyst Ahsan Mehanti said and added “the more disturbing fact was the absence of investors even at the attractively lower levels”.

As a result, the index shed an extra weight for the second week in a row and suffered a fresh fall of about 500 points or 4.5 per cent over the week including massive either-way battering.

Over the week bulls made repeated efforts to drive the bears out, but negative news that followed in quick successions did not allow them to reverse the bearish trend till the end of the week.

The KSE 100-share index received a massive battering more than twice and plunged below the index of 14,000 points on panic selling originating from all quarters in the backdrop of renewed wave of political uncertainty, notably the apex court’s ruling on the president’s eligibility to seek re-election. The 30-share index followed the trend.

It appears to be a belated investors’ reaction to the court proceedings on the petitions seeking court ruling on the issue, but as the date of verdict is around most of the leading investors tried to shed an extra weight. Some others said the central bank warning about the future inflationary pressures and the current account deficit despite growth rate above seven per cent might have lead to the bearish sentiments.

Although some of the leading institutional investors tried to reverse the trend after having made fresh covering purchases in the leading oil shares, some others offloaded position after mid-session in OGDC and Pakistan Petroleum, intensifying the index fall.

What seems to have worried investors and institutional traders the most was the ruling of the Supreme Court on the eligibility of president to seek reelection for the second terms possibly by the next week, said a leading analyst Hasnain Asghar Ali.

Faisal Abbas, another prominent analyst, thinks the snap sell-off was psychological rather than real and the market has the capacity and will to rebound after the verdict on the strength of corporate earnings.

“If the apex court ruling is negative then there could be more pruning”, he said adding “the strong holding capacity of the big ones may not allow any major shakeout at this stage”.

FORWARD COUNTER: Speculative issues also followed the lead of their counterparts in the ready section and fell across the board under the lead of OGDC, National Bank, Lucky Cement, Pakistan Petroleum, and some other barring MCB, which managed to finish higher on late covering purchases and so did some other leading shares.—Muhammad Aslam