KARACHI: Investors remained cautious ahead of the budget as the index fell for the fourth consecutive session, going down by 1.5% since Friday.
At close on Wednesday, the Karachi Stock Exchange’s (KSE) benchmark 100-share index showed a drop of 0.40% or 130.55 points at 32,599.
According to a Topline Securities’ report, passage of the Gas Infrastructure Development Cess Bill 2015 in the National Assembly also dented sentiments as investors feared that its implementation would impact companies which were not recording it in their accounts.
The amount to be collected through the cess from various sectors will be used by the government to fund the Iran-Pakistan and Turkmenistan-Afghanistan-Pakistan-India (Tapi) pipelines and the liquefied natural gas (LNG) import project.
“Moreover, confusion about the imposition of GIDC on new fertiliser plants like Fatima Fertilizer (-4.9%) affected sentiments,” said the report.
“Local funds were again major sellers as we witnessed a net selling of $10.4 million, taking the figure since May 8 to $52.6 million.”
The market is also waiting for the upcoming monetary policy for the next two months which the State Bank of Pakistan (SBP) will announce on May 23.
The central bank is expected to reduce the policy rate by 50 basis points or 0.5% in line with the decline in the 10-month inflation rate to 4.8%. In April, the inflation stood at 2.1%.
Trade volumes on the KSE marginally declined to 135 million shares compared to 136 million on Tuesday.
Shares of 331 companies were traded. Of these, 138 companies closed higher, 163 saw a decline and 30 remained unchanged. The value of shares traded during the day was Rs7.2 billion.
Fatima Fertilizer was the volume leader with 18 million shares, losing Rs1.85 to close at Rs35.63. It was followed by Engro Fertilizers with 12.5 million shares, gaining Rs0.63 to close at Rs84.95 and Byco Petroleum with 12.4 million shares, losing Rs0.71 to close at Rs13.29.
Foreign institutional investors were net buyers of Rs277 million worth of shares during the session, according to data compiled by the National Clearing Company of Pakistan.
Published in The Express Tribune, May 21st, 2015.
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