Cautious investors lift market slightly higher
KARACHI:
Stocks ended marginally higher in light trading on Monday because of investor uncertainty over a capital gains tax due to be imposed on July 1, dealers said.
The KSE benchmark 100-share index rose 0.18 per cent, or 16.91 points, to end at 9,662.62 points.
In its budget for the 2010-11 fiscal year, the government announced that capital gains tax of 10 per cent would be imposed on stocks held for six months or less and 7.5 per cent on stocks held from six months to a year.
Dealers said the government had previously agreed with the exchange that the capital gains tax would be levied only on profits made from the start of the fiscal year 2011 on July 1.
But now there are concerns the government may seek to tax gains made before that date and demand quarterly tax returns instead of the annual filing preferred by brokers, they said.
“Capital gains tax-related matters remained at the heart of the dull session as investors are still confused about its modalities as the year end approaches,” said Furqan Punjani, an analyst at Topline Securities Ltd.
The exchange and the government are in talks over implementation of the tax.
“A reason for Monday’s dull activity is that the end of June is nearing and that is when institutions generally avoid taking new positions,” said Faiza Naz, an analyst at JS Global Capital.
Monday’s turnover was 66.95 million shares, compared with 134.42 million shares traded on Friday. The total exchange value stood at Rs2.3 billion, almost half of Friday’s tally.
During the day’s trade 144 stocks closed higher, 229 declined and 29 remained unchanged in value.
Pak Strat Fund (KSE: PSAF) was the volume leader with 14.12 million shares gaining Rs0.64 to close at Rs6.9. Bank of Punjab (KSE: BOP) came second with 4.85 million shares gaining Rs0.48 to end at Rs11.37. Byco Petroleum (KSE: BYCO) came third with 4.13 million shares gaining Rs1 to close at Rs10.12.
IGI Insurance (KSE: IGIIL) was the KSE-100 top gainer of the day, its share price rising five per cent to finish at Rs68.75.
KASB Bank (KSE: KASBB) was in the losers list, its share price falling 7.96 per cent to close at Rs2.66.
Published in The Express Tribune, June 22nd, 2010.
Stocks ended marginally higher in light trading on Monday because of investor uncertainty over a capital gains tax due to be imposed on July 1, dealers said.
The KSE benchmark 100-share index rose 0.18 per cent, or 16.91 points, to end at 9,662.62 points.
In its budget for the 2010-11 fiscal year, the government announced that capital gains tax of 10 per cent would be imposed on stocks held for six months or less and 7.5 per cent on stocks held from six months to a year.
Dealers said the government had previously agreed with the exchange that the capital gains tax would be levied only on profits made from the start of the fiscal year 2011 on July 1.
But now there are concerns the government may seek to tax gains made before that date and demand quarterly tax returns instead of the annual filing preferred by brokers, they said.
“Capital gains tax-related matters remained at the heart of the dull session as investors are still confused about its modalities as the year end approaches,” said Furqan Punjani, an analyst at Topline Securities Ltd.
The exchange and the government are in talks over implementation of the tax.
“A reason for Monday’s dull activity is that the end of June is nearing and that is when institutions generally avoid taking new positions,” said Faiza Naz, an analyst at JS Global Capital.
Monday’s turnover was 66.95 million shares, compared with 134.42 million shares traded on Friday. The total exchange value stood at Rs2.3 billion, almost half of Friday’s tally.
During the day’s trade 144 stocks closed higher, 229 declined and 29 remained unchanged in value.
Pak Strat Fund (KSE: PSAF) was the volume leader with 14.12 million shares gaining Rs0.64 to close at Rs6.9. Bank of Punjab (KSE: BOP) came second with 4.85 million shares gaining Rs0.48 to end at Rs11.37. Byco Petroleum (KSE: BYCO) came third with 4.13 million shares gaining Rs1 to close at Rs10.12.
IGI Insurance (KSE: IGIIL) was the KSE-100 top gainer of the day, its share price rising five per cent to finish at Rs68.75.
KASB Bank (KSE: KASBB) was in the losers list, its share price falling 7.96 per cent to close at Rs2.66.
Published in The Express Tribune, June 22nd, 2010.