KARACHI, Feb 27: Despite positive dividend announcements and higher corporate earnings, stocks on Thursday failed to lure investors back in the market as fears about the US and allied attack on Iraq were growing. The KSE index fell 1.70 per cent or 41 points at 2,356.16.

The falling daily volume figures reflect the absence of institutional support and retailers thrust to get out of the market after liquidating their positions on the overvalued shares, notably the energy ones.

“Investors are in search of bearish news and if they failed to find some they coin one themselves to stay in the minus column”, brokers said. one

The KSE 100-share index fell further by 40.68 points or 1.70 per cent at 2,356.16, which was the lowest level for the day and showed it could ease further from the current highs.

Analysts said fairly encouraging corporate results pouring in during each session should have brought speculative traders back in the market but they stayed away as most of them were unsure about the future share business outlook.

“A cash dividend of 22.5 per cent (previous 20 per cent) by ICI Pakistan and an identical expected announcement later in the evening by another mega issue, PTCL should have generated a good bit of short-covering at least in these shares but there were no signs of revival of demand”,they added.

Although many other shares being in deficit including Pak PTA and FFC-Jordan Fertilizer have posted profits for their last financial years but omitted the dividend signals, a major change in the corporate sector, investors remained unmoved.

“The market is a victim of slack demand even from the financial institutions and until they are back in the market the current sell-off could get further momentum in the sessions to come,” predicts a leading broker.

He also fears that setting up of a cabinet committee by the prime minister to probe into the allegations by some MNAs about the higher prices of fertilizer and windfall profits being earned by the producers could further erode the share values of leading shares on this counter.

It was in this background that investors preferred to keep to the sidelines rather than rode the risky bandwagon. Trading volume fell to 75m shares from the previous 104m shares as losers maintained a strong lead over the gainers at 154 to 61, with 39 shares holding on to the last levels.

Some of the leading shares managed to show modest gains under the lead of 17th ICP, Habib Insurance, Honda Atlas Cars, Abbot Lab and Atlas Honda, up Rs1.50 to Rs4.65 stray support on reports of higher earnings for the last year.

Shell Pakistan remained under pressure for the third session in a row and suffered a fresh sharp fall of Rs13.95 followed by Pakistan Refinery, Pakistan Oilfileds, PSO and Indus Motors, off Rs5 and Rs2.40 respectively.

Other prominent losers included Gul Ahmed Textiles, Mari Gas, Aventis Pharma,Indus Motors, ICI Pakistan, National Foods and Nestle MilkPak, off Rs2 to Rs9.05.

Hub-Power led the actives, off 70 paisa at Rs33.90 on 26m shares, one third of the total volume followed by PTCL, easy 20 paisa at Rs20.20 on 16m shares, PSO, lower by Rs2.70 at Rs174.80 on 11m shares, FFC-Jordan Fertilizer, off 60 paisa at Rs9.75 on 4m shares and Sui Northern Gas, easy 85 paisa at Rs19.95 on 2m shares.

Other actives included Pakistan Oilfields, off Rs3.05 on 2.334m shares, Engro Chemical, up 30 paisa on 1.646m shares, Pak PTA, easy 25 paisa on 1.491m shares and ICI Pakistan, off Rs2.15 on 1.409m shares.

FORWARD COUNTER: Speculative issues also followed the lead of their counterparts in the ready section and suffered fresh sharp fall under the lead of PSO, off Rs2.75 and 3.100 for both the settlements. The matured February contracts will be rung off the board on Feb 28, and the March settlements will assume the role of ruling contracts.