Investors cash in on previous gains, market falls slightly

KARACHI: Stocks ended lower on Tuesday as investors opted to book profits following healthy gains a day earlier, and dealers said the market was expected to stay steady in coming days.

The Karachi Stock Exchange (KSE) benchmark 100-share index fell 0.29 per cent, or 28.47 points, to end at 9,763.17.

“There was no negative news, and investors just opted to book profit after the post-budget rally yesterday (Monday),” said Sajid Bhanji, a director at Arif Habib Ltd.

The KSE-100 closed 1.61 per cent higher on Monday in its first session after the announcement of the 2010-11 budget.

The government announced a capital gains tax of 10 per cent from July 1 to be imposed on stocks held for six months or less and 7.5 per cent on stocks held for more than six months to a year.

The KSE authorities had announced this measure in February after negotiating with former finance minister Shaukat Tarin but dealers said there were fears about a change in its mechanism after new Finance Minister Abdul Hafeez Sheikh joined office.

Tuesday’s turnover dropped 18 per cent to 130.6 million shares, compared to 160 million shares traded on Monday.

Second-tier stocks were the volume leaders while some activity in the oil, cement, fertiliser and banking sectors was also witnessed. Total exchange value stood at Rs3.97 billion.

During the day’s trade, 157 stocks closed higher, 234 declined and 13 remained unchanged in value.

Lotte Pakistan (KSE: LOTPTA) was the volume leader with 34.43 million shares gaining Rs0.54 to close at Rs10.61. Jahangir Siddiqui Company (KSE: JSCL) came second with 9.24 million shares losing Rs0.13 to close at Rs13.34. Telecard (KSE: TELE) finished third with 7.88 million shares losing Rs0.05 to close at Rs3.52.

“The banking sector witnessed some profit-taking with National Bank of Pakistan (KSE: NBP), MCB Bank (KSE: MCB) and United Bank Limited (KSE: UBL) declining by two per cent, 1.1 per cent and 1.8 per cent respectively,” said Sameer Danawala, an analyst at JS Global Capital.

Pakistan Telephone Cables (KSE: PTEC) was the KSE-100 top gainer of the day, its share price rising a massive 14.22 per cent to Rs2.65.

Bestway Cement (KSE: BWCL) was in the losers’ list dropping 7.1 per cent to Rs13.01. Royal Bank of Scotland (KSE: RBS) closed in the red, its share price shedding 3.7 per cent to close at Rs12.05.

Published in the Express Tribune, June 9^th, 2010.