The Karachi Stock Exchange’s (KSE) benchmark 100-share index ended 0.05 percent, or 4.96 points, up at 9,796.85.
“Trade remained lacklustre for most part of the day as investors did not want to take much of a risk towards the end of the fiscal year,” said Mohammed Sohail, chief executive of Topline Securities, a local brokerage house.
Pakistan’s fiscal year runs from July 1 to June 30. “Also, investors are still awaiting clarity (on the capital gains tax), and until its modalities get clear, both local retailers and institutions would remain cautious,” said Sohail.
In its budget for the 2010/11 fiscal year, the government announced that a 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 between six months and one year from July 1.
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 2010/11 fiscal year 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.
Dealers said investors were also waiting for a decision from the Securities and Exchange Commission of Pakistan (SECP) on whether margin buying would be reintroduced to the bourse, which would help increase trade volumes.
The KSE authorities and the regulator met on Tuesday to discuss margin buying and other leveraged products and decided to form a committee which is required to submit its recommendations within 15 working days, the SECP said.
Friday’s turnover was 89.16 million shares compared with 80.52 million shares traded a day earlier. Total exchange value stood at Rs3.9 billion.
During the day’s trade, 147 stocks closed higher, 224 declined and 35 remained unchanged in value.
Worldcall Telecom (KSE: WTL) was the volume leader with 12.31 million shares losing Rs0.17 to close at Rs2.92. Lotte Pakistan (KSE: LOTPTA) came second with 6.93 million shares losing Rs0.33 to end at Rs8.39. Hub Power Company (KSE: HUBC) came third with 3.35 million shares losing Rs0.03 to close at Rs32.18.
“Oil and Gas Development Company (KSE: OGDC) rallied for a second straight day on the back of a discovery in Shekhan-1 well,” said Ahmed Rauf, an analyst at JS Global Capital.
The stock moved up 1.6 per cent at the end of the day closing at a 44-month high at Rs141.16.
Bestway Cement (KSE: BWCL) was the KSE-100 top gainer of the day, its share price rising 6.49 per cent to finish at Rs15.75.
Published in the Express Tribune, June 26th, 2010.
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