RECORDER REPORT
KARACHI: The Karachi share market plunged by 79 points as investors reacted to reports of a proposed increase in Capital Gain Tax (CGT) in the upcoming federal budget.
The KSE-100 index closed at 32,763.48 points from 32,842.59 of the previous trading session. The benchmark index hit the intraday high and low of 32,850.07 and 32,671.91 points, respectively.
The trading turnover slid to 148.7 million shares from the previous day’s 200 million. The shares traded value fell to Rs 6.57 billion as compared to Rs 10.8 billion Wednesday.
Overall, 344 stocks changed hands of which 147 closed higher, 173 lower while 24 stayed unchanged. The market capitalisation also dipped to Rs 7.124 trillion compared to Rs 7.137 trillion a day earlier.
Foreign portfolio investment showed a negative trend of $ 1.322 million net selling. Pak Elektron, which rose to Rs 68.16, led the day’s volume with 14.56 million of its listed shares traded.
Other best performing issues included Byco Petroleum 12.8 million, Ghani Automobile 12.6 million, Pakistan International Bulk Terminal 7.5 million, Jahangir Siddiqui Company 6.9 million, Maple Leaf Cement 6.6 million, Japan Power 6.5 million, Hum Network 6.2 million, Bank of Punjab 5.6 million and Sui Northern Gas 3.7 million shares.
Trade on the futures market remained thin at 39.9 million contract compared to the previous 63.6 million. “Sentiment remained bearish on reports for govt proposal on CGT rates and slab revision in the upcoming federal budget,” said Ahsan Mehanti Arif Habib Corp.
Profit-taking was witnessed in select stocks across the board on concerns for falling banking spreads and uncertainty over the federal budget, he added. Weak global crude oil prices played a catalytic role in the bearish activity at KSE amid late session support in the leveraged stocks likely to gain from Saturday’s discount rate cut.
Mohammad Rizwan of Topline Securities said the Federal Board of Revenue’s proposal to increase CGT rate in Budget 2015-16 trembled investors’ confidence.
The proposed gas tariff hike by the Ministry of Petroleum and Natural Resources bode positively on the share prices of gas distribution companies i.e. SSGC and SNGP, he said. The two scrips added 1.86 and 5 percent, respectively. “The market closed slightly negative… mainly due to proposal of CGT and gas tariff hike,” the analyst said. He also referred to uncertainty in the budget which affected investor sentiment.
