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Index shed another 61.23 points amid light trading

KARACHI - Pakistani stocks yesterday resisted larger declines on active short-covering on selected counters amid strong rumours that the president may resign on Thursday,ending the protracted political uncertainty.

The president had said a couple of days earlier that the next two or three days could be very crucial and analysts said it could well be his pointer to his possible exit on the independence day.

But the fresh bull-run on the US dollar weakened the rupee to its lowest level so far at Rs75.50 and 76.00 on the open market for buying and selling respectively and analysts predict this could be the last bear onslaught on the value of the rupee.

Unlike the overnight steep decline, the KSE 100-share index shed only 61.23 points at 9,902.35 as compared to 9,963.58 a day earlier on strong fund buying in the leading base shares, notably MCB, National Bank.

Analysts said the general perception was that the president's exit will allow the dust raised on the issue to settle down leading to normalcy on the political front.

But some others said the weakness of the rupee,which was quoted at Rs76.00 in kerb will continue to have its toll on the bourse until sanity returns to the current turmoil on the financial front.

"The rupee has depreciated by 20 per cent against the US dollar since January this year,and had negative bearing on the share values more than one ways, notably leading to the flight of capital to other markets," analyst Tabish Hasan said.

"Every thing is expected to be in order after the chief investor worry in regard to the prevailing political uncertainty will end," said Ahsan Mehanti another leading analyst adding "the ruling elite then will opt for their assigned official tasks to boost economy and contain high inflation."

The future direction of the market will be known on Friday when it reopens after independence day holiday as by that the outcome of the current rumours will be out, he added.

On the corporate front,dividend announcements, notably by PSO and Shell Pakistan were on the higher side and were well-received by the investors.

Shell Pakistan posted fresh gain of 19.21 followed by Colony Sugar, up by Rs38.00, while National Foods and Pakistan Oilfields came in for fresh selling and fell by Rs14.70 and 13.49 respectively.

Trading volume fell further to 69 million shares from the previous 82 million shares as losers held a strong lead over the gainers at 154 to 87, with25 shares holding on to the last levels.