KARACHI - The past's trend of overnight boom at the stock market seems over as the Continuous Funding System (CFS) is not being provided to the investors and the traders, The Nation learnt on Monday. In the past the CFS or badla financing was a key force behind abrupt increase of 400 to 600 points increase in the KSE-100 index in just one day. The CFS, however, was also the major cause of overnight substantial corrosion in the value and worth of the equities at the stock markets in the country, capital market sources said. Sources said that the financial institutions and the brokerage houses were not providing CFS to their clients as the government was not in favour of this mode of trading in the prevailing critical scenario. During the past three trading sessions the KSE-100 index has gradually edged up although the experts at the financial institutions and investors were expecting a rapid boom at the stock market in the wake of the settlement of the stuck-up CFS arrears and the provision of 20 billion rupees stock market fund. After the removal of the floor from the stock markets, two mechanisms of trading are prevailing at the markets delivery (cash based) and future trading of shares. "We are not hopeful of the revival of the Continuous Funding System at the stock markets as we are hearing that the IMF was not in favour of this mode of trade," a senior official at a brokerage said. In the past the CFS or badla has resulted in unexpected upward and downward abnormal fluctuations that benefited a few players, but caused huge losses to the small investors. The abolition of the CFS would minimise the impact of speculations and negative developments relating to the stock markets and reduce the vulnerability of the equities. Capital market sources also hinted that the KSE-100 index might stagnate around 7000 points in coming few days. They said that in next few days the problems relating to the settlement of CFS, banks guarantees and 20 billion rupees stock market fund would come to the limelight that would dampen the trading and again demoralise the investors and the shareholders. They said that the stock market has started towards stability and growth gradually, but the above-mentioned issues, if not handled appropriately would cause a blow to the smooth trading of the market. It was a good development that the stock market has entered the positive zone after facing the worst-ever recession that massively eroded the capital, index and value of the equities. For example in April 2007 the KSE-100 index settled above 15,440 points and the market capitalisation mounted to around 4.45 trillion rupees (77 billion US dollars when calculated at 62 rupees dollar-rupee exchange rate prevailing at that time). Till last week the KSE index had not only plunged to below 6000 points, but the market capitalization had also dithered to about 2.35 trillion rupees (30 billion US dollars). After facing an unprecedented crisis, the stock market has begun its journey towards growth, but this smooth sailing would depend on the proper enforcement of stock market fund, removal of obstacles relating to the CFS and bank guarantees.