Stock market remains dull on opening day

KSE-100 index falls 76 points.

KARACHI: The stock market recorded another lacklustre session on Monday as investors preferred to stay on the sidelines before the launch of margin trading system and clearance of prevailing political uncertainty.

The Karachi Stock Exchange (KSE) benchmark 100-share index ended 0.64 per cent or 76 points lower at 12,041.42.

Lingering issue of Raymond Davis and the approaching deadline of PML-N’s 10-point agenda created negative sentiments, said JS Global Capital analyst Ahmed Rauf. Tensions remained between Pakistan and the US over the fate of Raymond Davis, a US official arrested on the charge of killing two men in Lahore on January 27.

The bourse board of directors approved rules for the margin trading system last week and confirmed that the mechanism will come into force before the end of February.

Furthermore, deteriorating political situation in the Middle East sparked fears of foreign selling, added Rauf.

Trading volume increased slightly but still remained at a dismal 81 million shares compared with 70.36 million shares on Friday. United Bank Limited closed down 2.9 per cent at Rs61.07 despite announcing a 21 per cent growth in net profit along with cash payout of Rs4 in its 2010 earnings.

Shares of 654 companies were traded on the first trading session of the week. At the end of the day, 384 stocks closed higher, 169 declined and 101 remained unchanged. The value of shares traded during the day was Rs1.96 billion. Lotte Pakistan PTA was the volume leader with 6.67 million shares, losing Rs0.25 to finish at Rs15.74. Pakistan Telecommunication Company Limited, the second highest traded stock with 5.83 million shares, closed 1.4 per cent higher at Rs19 amid rumours that it may sell its stake in Ufone, said Rauf.

FBR, KSE officials meet

A meeting was held between senior officials of the Federal Board of Revenue (FBR), headed by FBR Additional Secretary Revenue Division Asrar Rauf, and the Karachi Stock Exchange Taxation Committee, headed by Abdul Qadir Memon to discuss capital gains tax rules, according to a press release sent by KSE.

“Meeting between the brokers and tax authorities resulted in assurances by taxmen that all issues pertaining to capital gains tax will be addressed and amendments in tax rules will be made accordingly,” said Elixir Securities equity dealer Nazim Abdul Muttalib.

Published in The Express Tribune, February 22^nd, 2011.