Sweep 2nd hand operation & watch time setting on my Pulsar watch.

If your watch is solar powered the second hand performs this characteristic when it's in need of a charge. Try placing your time piece under a bright light for short time or in direct sunlight and see if this helps you with your problem.

To set the timer hand on these models of Pulsar watches, do the following: 
Looking at the face of the watch, there are two buttons and a crown on the right side. The TOP button is Button "A". - The BOTTOM button is Button "B".
There are 3 positions on the crown: IN (#1), FIRST CLICK (#2) & SECOND CLICK (#3).
First, pull the crown out to the second 'click' position (#3) ... This is all the way out. (STOP THERE! Pulling harder will harm your watch! Don't try to pull past position #3!)
Push and hold Button "A" for two (2) seconds. The dial will sweep around to the 12 O'clock position. You can advance the timer while the crown is in position #3 (second click out) to reset it back to the default position. 
The manual says that if you pull the crown out to position #3 while the timer is measuring, the hand will reset back to the 12 o'clock position... I haven't tried that, so I can't confirm.

The "second" hand on this watch is not actually a 'sweep' second hand, as on other watches.
This is a timer dial. ["Stopwatch 1/5 Second Hand"]
To start/stop this, use the top button (Button "A").
To reset this dial to 12 O'clock, use Button "B", after first stopping it with Button "A".
The "second" hand is the small dial at the 9 O'clock position.
In actuality, you 'could' start this and just not stop it...  Then it would function as a "large second hand". That would be up to the owner. (it might use more battery power though... ?)

Possibly the hands are touching or the sweep hand is touching the crystal

Great watch! Operation should be pretty straight forward. The top button starts the chrono and stops it. The bottom button resets it. To calibrate the sweep arm into the right position pull the crown out to the first or second set position and press the start button until the sweep arm is in the start position you desire. This is typically 12:00 or 0.
If your chrono is not working then have the battery checked. If the battery has been recently replaced then make sure the watch doesn't need to be cleared.
I recommend you take this to a watch maker/technician who will be familiar with the service requirements of this model including resealing and pressure testing the watch to be sure it is sealed to its marked water resistance specifications.

Thanks!

Pull the crown out to the first or second setting position then press and hold down the start button for the chronograph. This should begin to move the sweep arm. Stop when it is in the correct position.

This can vary just slightly between brands but is generally the same.

When the second hand moves in short jumps rather than a smooth sweep or a second-by-second hop, it means that the battery is about to run out. Usually, with a week or two the watch will stop working altogether. You should go and have it changed as soon as possible.

The Lupah has a chronograph so dont worry about the sub dials while your setting the time. Pull the crown out to the first position and set the time. For the date pull out to the second position and set the date.

To set the chronograph sweep arm pull the crown out and press and hold down the start button. The sweep arm will move into position. Stop it on the 12:00 or 0 position.

Actually the sweep arm can be set to 0 and will probably have to be every time you have the battery replaced. To set the sweep arm pull the stem and crown out to the first or second set position then press and hold down the start button. The sweep arm will move into position and you can let go of the button when it is where you want it. Make sure to set the right time and replace the crown in the time position.

Great watch!!

sounds like the gear that turns the second hand has a tooth missing.