Turnover declines to lowest level in history

LAHORE - Another dismal day on the floor of Karachi bourse was seen with the ready turnover declining to its lowest level of 4.3 million shares.

The KSE-100 index on the weekend lost another 1.71 points and closed fractionally above the 9,200 points level leaving just 66 points from market floor level.

Dealers said that global equity markets soared by enormously on the back of banks share price gains, as governments worldwide stepped up their fight against the worst financial crisis in decades.

Aqeel Karim Dhedhi, head of AKD Securities and one of the most prominent figures in securities business, was depressed and furious during his interview to The Nations over heavy losses, suffered by stockbrokers due to the present market chaos in the country. He regretted that on the one hand, the Gilani government was doing nothing to save shares trading while on the other, the US government had put together a rescue plan to clear away the mountains of bad debt that had weighed down banks, eventually causing a decline of the share prices in huge amount. In another move, he said, the US Securities and Exchange Commission had banned the short selling of shares to stop this turmoil.

Citing the example of foreign equities, Dhedhi further said the European Central Bank and Bank of England had offered to lend an additional 40 billion dollars to financial institutions struggling to obtain funds amid a worldwide squeeze on credit. That was why in European midday trading on Friday, London surged 8.03 per cent, Paris won 7.11 per cent and Frankfurt rallied by 4.72 per cent, he added.

"Our govt is behaving with the brokers like dogs. Government considers us like a dog. They should follow the US and EU countries where authorities have pumped billions of dollars to support their markets. This justifies the demand of the KSE board for creating market support fund, enraged Dhedhi said.

"The creation of huge government-sponsored funds to encourage investment in equities is having a positive effect on markets," he pointed out.

Analysts said that market needed support and some solid corrective measures to address the ailing economy. Government should realise that power tussle would have very negative impact on the economy and pave the way for non-political forces to interfere, they added.

They said that apart from a weak economy, rising fiscal deficit and higher cost of industrial outputs, the immediate concern appears to be the weakness of the rupee, which is now reported at a record low against the US dollar.

Earlier, the market opened 0.75 points minus at 9201.56 points and resumed dull and range bound activity. Its opening proved to be its day high and during intra-day trading market touched 9199.20 points low after breaching 9200 points level.

Free float index opened in minus column and remained in minus column throughout the day. Moving constantly down wards it finally closed at its day low at 10110.52 points after shedding 6.60 points.

All shares index lost 1.08 points in today trading and closed at 6651.56 points. KMI following the footsteps of other three indexes closed 9.54 points down at 11224.42 points.

Traded scrips increased to 104 in numbers and out of those 17 closed with plus and 15 with minus signs while 72 scrips kept last price. Volumes dropped to historic low, breaching previous recorded low of 5.34 million shares by registering the turnover of 4.3 million shares. ENGRO while keeping the top position in volumes contributed volumes of 0.546 million shares in total volumes. From top thirty volumes leaders just 4 scrips gave plus closings against 8 minus closings while 18 scrips remained pegged to last level.