Another dull day as members’ fight for survival continues (25122008)

LEADER REPORT
KARACHI: The day remained dull with depressed investors and members confidence, due to the lack of liquidity and tension between India and Pakistan. The index declined another 3.8 percent on Wednesday, as it closed at 6,660 points after shedding 264 points. The thrift has accumulated to 27.5 percent after the removal of floor from 9,144 points. Activity was particularly seen only in 3rd tier scrips during Wednesday's session, while the blue chips maintained the dead stance, volumes remained low at 59 million shares out of which 127 scrips declined, while 49 scrips advanced.
NCCPL declared 32 brokers as default!
NCCPL has declared 32 brokers as default and suspended them from trading system who were unable to deposit their outstanding mark-to-market losses. The total amount outstanding of these 32 brokers plus two more brokers on the verge is Rs4.75 billion, while NCCPL has also closed the CFS terminals of 54 brokers and have issued them the notice to repay their outstanding loans. In those 32 default brokers 18 are from Karachi stock exchange and rest are from other two exchanges.
Index to regain momentum in longer time frame
Investors' sentiment is anticipated to remain flat as they await to see the bottom of the market where long term investors are eyeing to accumulate various scrips. While the lack of liquidity, weak economic and law & order condition prevailing are hurdles in the markets rebound, stabile earning and favorable conditions may bring the market back on track as investors interest may flow back with various scrips becoming attractive based on values and dividend yields in the long term perspective.
What will be the way forward?
In this drift, 32 brokers were the first tranche to go and 15 more are in rumors. The question of the time is that how many names will be added on the list, and how much this dead lock will affect the declining market. Considering the current situation, market is in desperate need of the support through fund or any monetary side measures, which will help bringing the confidence in the market.