LAHORE - The discontinuation of the CFS MK-II without any replacement product and increase in T-bill rates marginalized the positive sentiments at the local bourses during the outgoing week. However, CPI inflation falling to 11 month low boosted the market on the last trading day of the week. Resultantly, the KSE 100 Index was up 2.5 per cent over the previous week with average daily volumes touching 18 month high. Experts said the market, which was up 17 per cent in previous two weeks lost its momentum amid SECP decision to phase out CFS MKII without a replacement product. Moreover, a 92-104bps hike in T-bill cut off yields in the latest auction on Wednesday and profit taking after a sustained rally put further pressure on the market. Atif Zafar, a capital market expert, observed the market rallied on the last trading day on account of Marchs CPI inflation falling to 11 month low. A persistent fall in CPI is expected to pave the way for a possible decrease in discount rate by the central bank in the future. A major highlight of the outgoing week was a surge in volumes amid interest from local high net worth individuals and off-shore investors. Average daily volumes were up 35.8% to an 18 month high of 400mn shares (US$147mn) as against 295mn shares (US$139mn) last week. Moreover, CFS investment declined amid CFS phase out to Rs1.2bn with an average annualized rate of 25.12%. KSE 30 index closed at 8086.77 pts with a gain of 174.10 points. The Average future volume market was worst this week as compared to the previous week, as the average future market volume stands at 0.001 million shares as compared to 0.0741 million shares last week trading. Market capitalization stands near to Rs. 2.291tr. Ahsan Mehanti from Shahzad Chamdia Securities said that intense buying witnessed as expectations loomed on lifting of 58(2b) and 17th amendment under the charter of democracy. Likewise, fall in core inflation by 40bps taking positively by investors as a route to fall in discount rate in the upcoming monetary policy announcements, Asian Markets recovery, Capital gains expectations from Banks, hopes for funds allocation from friends of Pakistan meeting this month played catalyst role for positive activity, he added. After a gap of 15 weeks, off-shore investors were net buyers in the outgoing week Foreigners bought shares worth US$15.1mn while shares amounting US$12.1mn were offloaded, resulting in net buying of US$3mn. Trend forecasting oscillators are currently bullish on KSE-100 index. KSE-100 Index is currently 10.2% below its 200-day moving average and is displaying a downward trend. As far as resistance level is concerned, the market will see major 1st resistance level at 7728.44 and 2nd resistance level at 7838.92 while Index will continue to find its 1st support level at 7401.73 and 2nd support level at 7185.50. Experts said that panic seemed to be end which was triggered due to some ambiguity regarding cut in discount rate and became serious after increased in interest rate of T-Bills, however, the latest data released by the SBP, CPI inflation declined to 19.07%YoY in month of March FY09 which was stood at 21.07%YoY in February FY09, which may help SBP cut in the policy rate statement due at the end of April 09. On the last trading day of the week, bulls completely dominated in the market as KSE-100 opened on a positive note while the index once again crossed 7600 level and closed near to intra-day day high at 7617.96 level with 4.41% upsurge. On the other hand, as per FIPI data USD3.56m foreign buying was recorded in last four session which further enhanced local investors confidence. Moreover, across-the-board phenomenal buying observed in both the session while the major blue chip scirps remained upper cap. Furthermore, OGDC lead the rally and contributed 60.96 points to total index surge with extended gain by 5.0% while KESC remained volume leader with 16.95m shares on the last trading day of the week.