Pakistans capital market fell by a percentile during week ending Friday last amid sluggish volumes and bearish trend of trade due to the apparent impact of Capital Gains Tax imposed in new financial year started on July 1. Players offloaded stocks during the last couple of working days of the last financial year, ended on June 30, that, coincidentally, were the first two sessions of the week that was. Pundits attributed extraordinary crunch in volume of trade to the closing of accounts with the financial year in addition to the fear of CGT. Players opened the week under review on negative note and panic selling was witnessed. According to insiders, foreign fund mangers also sold most of their portfolios ahead of the imposition of the CGT. This panic selling drive resulted in well over a percentiles loss in the indexed value of the stocks while the volume squeezed to extreme low on Monday last. Oversold state of the market and the trimmed prices of stocks lured some fresh buying especially in late hours of trading on Tuesday last. Consequently, the market though remained dormant in terms of total turnover of shares during the session, managed to recover by a third of a percentile. Midweek came to tie the stocks in a limited range of fluctuations. Foreign funds buying in selected stocks that were available at extra-ordinary lows helped the market better a bit on Wednesday last. As a majority of players preferred to stay on sidelines that market remained dull till the second session of week under review. Sluggishly moving within a short-range from intra-day low to the intra-day high the market settled bagging a nominal gain at the end of the session on Thursday last. Bears regained the floors from the fragile bulls and the trend of trade again fell to the negative zone. On Friday last, the market slipped by a third percentile chiefly due to deterrence of the capital gain tax. Analysts were of the view that the players might continue with their selling spree in order to gain from short selling that could not be liable to the CGT. Unless there is a margin financing mechanism in place the market would lose resistance against downside movements, they added. Apart from the Capital Gains Tax the pundits were of view that the market was plummeting chiefly due to the external factors including economy, politics, and above all ripples of jerks in the global securities markets. They observed that the market players including foreign fund mangers had been closely watching developments on the political front in Pakistan that were constantly disseminating uncertainty. The talk about plethora of fake-degree cases of the parliamentarians leading to a situation that would require mid-term elections was sufficient to alarm caution bells for players. Political uncertainty caused by issues ranging from President Asif Ali Zardari and his cronies alleged corruption to the fake-degrees of the MPs has literally marred the markets potential to grow with beginning of the new financial year. The apex court taking up these cases during the days to come would certainly have a deep impact on the sentiment of the bourses in the country, they maintained.