OUR STAFF REPORTER LAHORE - The range-bound trading due to buying of selected stocks was witnessed during the outgoing week, just ahead of monetary policy announcement. The market closed the week at 11,854 level, showing an increase of 0.8 percent WoW. Average daily volumes dropped by 9.3 percent WoW to 75 million shares, while foreigners remained net sellers of $2.7 million. Experts said that renewed buying interest was seen in DGKC after the media news of starting of construction of Bhasha Dam. In the same way fertilizer sector was among the most active stocks while oil stocks also closed in positive on the back of increasing international oil prices. Stock market analysts said that the domestic political uncertainty and concerns over global economic outlook overshadowed recovering US-Pak ties and expected easing in the monetary policy due on October 8, 2011. In the T-Bills auction held during the week, the 3 month cut off yield came in 76bps below the discount rate. Moreover, CPI for September dropped to 10.46 percent from 11.56 percent in August 2011. Naveed Tehsin, a stock market expert, said that the power crisis remained in the limelight throughout the week as street protests were carried out, mostly in northern part of the country. To tackle the situation, Energy Conservation Plan was proposed to the Prime Minister for reducing power consumption through two weekly holidays and other measures. Moreover, the government has decided to convert outstanding financing and accrued markup of public sector power companies and commodity financing into PIBs. Primarily, banks will benefit, however, companies in the energy chain will gain through additional credit availability for the sector. Fertilizer manufacturers raised ex-factory urea prices by Rs174/bag owing to SNGPLs gas suspension to fertilizer producers due to reduced supply from Qadirpur. Bearing a positive impact on earnings of FFC and FFBL, the stocks gained 5.3 percent WoW and 2.9 percent WoW, respectively during the week. On the other hand, local cotton prices declined by 3 percent in the last week due to higher cotton arrivals during the month of September together with falling international cotton prices due to gloomy world economic outlook. Samar Iqbal, Equity Dealer at Topline Securities pointed out that select stocks buying kept the trading session ranged bound just ahead of monetary policy announcement. Renewed buying interest was seen in cement sector after the media news of starting of construction of Bhasha Dam. Ahsan Mehanti, Director, Arif Habib Investments, observed that stocks finished higher this week led by oil and fertilizer sector scrips on stable global commodities, higher fertilizer and cement prices and easing power crises and circular debt concerns. He said that the likely cut in SBP key policy rate on Oct 8 after favourable CPI Inflation QTR11 at 11.46pc, government's political patch up with political ally MQM and improvement in rupee value supported the bullish sentiment. He pointed out that expectations remained high for improvement in Pak-US bilateral relations on diplomatic front, recovery in global stocks on expectations for early settlement of Europe debt crises and positive US jobs data played a catalyst role in bullish sentiment despite concerns for cut in US aid for Pakistan economic support. Atif Zafar, an analyst, said that the KSE-100 lost 5.9 percent in value during 3Q2011, its sharpest fall since 4Q2008.. The gloom at the bourse for the most parts was owing to 1) S&P downgrade of US debt rating fueling speculation of another recession, 2) strained US-Pak relationship due to former accusing Pakistan of having links with the banned Haqqani network, 3) deteriorating law and order situation in Karachi and 4) the subsequent tension on the political front. Hence, the avg. daily volumes fell to their lowest in 40 quarters to 59mn shares (ex. price floor period), while foreigners were leading net sellers of US$46mn. Nevertheless, the KSE-100 managed to smartly outperform its regional peers by an average 7 percent thanks to impressive corporate result announcements and lower than anticipated inflation figure - hinting towards cut in the discount rate in the upcoming policy review. Fertilizer stocks were yet again the star performers in 3Q2011, with FFBL, Fatima and FFC outperforming the index by a respective 50 percent, 19 percent and 17 percent on the back of strong corporate result announcements for 2Q (FFBL and FFC earnings rising by an average 84 percent YoY in 2Q) and expectation of further growth in the forthcoming quarter. BAFL and SSGC also gained 18 percent and 14 percent, respectively owing to better than expected earning announcements, while Luck outperformed the index by 18 percent because of expected improvement in margins thanks to rising prices in the domestic market. MCB, OGDC and PTC were notable laggards, down 12 percent, 12 percent and 18 percent respectively.