Business

Market watch: Bourse experiences post-budget uncertainty

Benchmark KSE-100 index falls 52.75 points.

Our Correspondent June 04, 2014 1 min read

JS Global analyst Fahad M Ali said the first trading session after the budget saw textile being the major highlight.

KARACHI: Budget ripples were witnessed as another apprehensive day ensured the index ultimately closed lower.

The Karachi Stock Exchange’s (KSE) benchmark 100-share index fell 0.18% or 52.75 points to end at 29,452.23.

JS Global analyst Fahad M Ali said the first trading session after the budget saw textile being the major highlight.

“This was mainly on account of incentives announced for the sector to boost export growth and reduction in Export Refinance Facility (ERF) rate to 7.5% from 9.4%,” said Ali.

According to Ali, most of the companies in the sector closed at their upper circuit. Power sector remained under pressure as subsidy has been reduced by Rs124 billion to Rs185 billion.

Automobile sector remained in the positive sentiment as 10% Federal Excise Duty on locally manufactured motor vehicles exceeding 1,800CC has been withdrawn making Indus Motor the main beneficiary.

Ali concluded that the decision of increasing Capital Gains Tax to 12.5% instead of 17.5% was a good sentiment booster; however GoP decided to impose 5% tax on bonus issue. Investors remained cautious waiting for a more detailed report from the budget.

Trade volumes fell to 259 million shares compared with Tuesday’s tally of 319 million shares.

Shares of 372 companies were traded on the last trading session of the week. At the end of the day, 209 stocks closed higher, 145 declined while 18 remained unchanged. The value of shares traded during the day was Rs14.09 billion.

Maple Leaf Cement was the volume leader with 21.8 million shares, losing Rs0.30 to finish at Rs30.89. It was followed by Lafarge Pakistan with 17.32 million shares, gaining Rs0.10 to close at Rs14.73 and Fauji Cement with 16.5 million shares, gaining Rs0.14 to close at Rs19.48.

Foreign institutional investors were net buyers of Rs743million during the trade session, according to data maintained by the National Clearing Company of Pakistan Limited.

Published in The Express Tribune, June 5^th, 2014.

Like Business on Facebook, follow @TribuneBiz on Twitter to stay informed and join in the conversation.