The assassination of the former prime minister Benzair Bhutto in a targeted terrorist attack at the fag-end of the week triggered panic selling from all the quarters, pushing the KSE 100-share index sharply lower from its recently attained all-time peak level of 18,815.00 points.

How the death of a popular leader of the stature of Benazir Bhutto will be mourned by her millions of supporters throughout the country during the next couple of days will keep the buying interest in a low-key, some analyst said. The foreign investors who were planning to re-enter the market possibly with the advent of new year trading may stay away for an indefinite period until the law and order situation improves, they added.

Most optimistic among them were of the view that after initial major shake-out, the market could digest the negative fallout of Benazir Bhutto’s death within a shortest possible time on the strength of its positive basic fundamentals.

But some others said, the market could plunge to any lows in the coming weeks as her death has raised many issues including the holding of the national elections on the Jan 8, 2008, law and order situation and the political uncertainty.

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Earlier, in the week, the KSE 100-share index battered its previous single-session high record of 14,772 points at 14,814.85.00, as investors continued to build-up long positions at the lower levels boosted by reports of higher corporate earnings, notably by the banking shares.

“To close the fading year around the index level of 15,000 points or not is the question being hotly debated by the leading bulls” analyst Faisal A.Rajabali said adding, “it is now only 200 points away in a week’s trading, not an ambitious target judged by its previous performance “.It has risen by 400 to 500 points in a single session more than once in a bull market.

But the assassination of Benazir Bhutto has changed the entire future stock market outlook and nobody could precisely predict how would it react to the political murder.

The market is expected to follow the news from the political front, some others said adding eventually it would manage to behave properly in due course.

The trading resumed on a bullish note after a long holiday weekend on account of Eidul Azha as investors were not inclined to take even a technical breather in a rising market and for good reasons too.

It was perhaps in this background that Arif Habib Bank, formerly Rupali Bank whose controlling shares were purchased by Arif Habib group of companies, made its debut on the forward counter at the face value of Rs10.00 and steadily rose to hit the session’s high of 40.75 before finishing around Rs37.30, up by Rs.27. over the opening on 21m shares.

Most of the banking shares, notably the low-priced among them remained in strong demand on active support and so did Bosicor Pakistan, on news of its sell-off to a Dubai-based investment company.

Indications are that a section of leading bulls is inclined to push it to their targeted level of 15,000 points before the year is out, some brokers believe, ”the current week could be very crucial both for the index level and the market’s future direction”. “It was the advent of year-end buying confined essentially to sectors whose earnings are billed at the top”, analyst Ahsan Mehanti said, adding. “selective foreign buying support could not be ruled out”..

Both reports of higher corporate earnings by the banking and oil shares and prevailing lower prices provided an attractive bait to both the financial institutions and the speculative traders to build up long positions, which ensure handsome capital gains ,another analyst Ashraf Zakaria said.

“Elections uncertainties are there, in regard to who will form the government at the centre”, another leading analysts said adding, “but investors seem to have decided to follow the market fundamentals rather than the external pressures”.

However, the general perception is that the Jan 8,2008 elections may throw a hung parliament, which suits to the present rulers as that could lead to the continuation of the current economic and financial policies, some others predict.

FORWARD COUNTER: After initial rise, speculative issues on the forward counters also came in for active profit-selling and mostly finished with clipped gains under lead of National Bank, Askari Bank, MCB. But low priced issues managed to finish on-balance with modest gains or unchanged.—Muhammad Aslam


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