Market Watch: Equities fall 72 points on budget uncertainty

Foreign portfolio investment registers outflow of Rs73m.

KARACHI:

Equities dropped on Tuesday amid low volumes as uncertainty prevails ahead of the budget.

The Karachi Stock Exchange’s (KSE) benchmark 100-share index fell 0.59 per cent or 72 points to end at  the 12,123.15 point level.

Investors preferred to remain on the sidelines ahead of the federal budget which will decide the fate of the capital gain tax on sale of shares, said Topline Securities equity dealer Samar Iqbal. The budget is scheduled to be announced on June 3.

The fertiliser sector witnessed profit taking at inflated levels on the proposal of the petroleum ministry to increase gas tariffs for all the sectors and remove tariff subsidies.

Foreign institutions were rumoured sellers in index heavyweights while local players preferred to stay on the side lines ahead of the budget announcement, according to analysts.

Foreign portfolio investment registered a net outflow of Rs73 million during the session, according to data maintained by the National Clearing Company of Pakistan Limited.

Trade volumes rose two per cent to 123 million shares compared with Monday’s tally of 120 million shares. Volumes continued to register growth but most of the volumes were witnessed in second and third tier stocks.

Fauji Cement Right, the volume leader of the day, recorded 37 per cent of the total volumes on its debut on the board. The scrip gained Rs0.13 to close at Rs0.14.

It was followed by Dewan Salman with 15.59 million shares losing Rs0.36 to close at Rs3.02 and Dewan Motors with 7.62 million shares gaining Rs0.34 to close at Rs2.96.

Dewan Group stocks dominated trade once again on reports that one of its companies may undergo restructuring.

Shares of 341 companies were traded on Tuesday. At the end of the day 84 stocks closed higher, 158 declined while 99 remained unchanged. The value of shares traded during the day was Rs1.7 billion.



Published in The Express Tribune, June 1^st, 2011.