KARACHI: The earlier day’s rally proved short-lived as the investors scrambled to seek an exit from the market, pulling the KSE-100 index down by 79.11 points (0.24 per cent) to settle at 32,763.48 on Thursday.

Investors worried over the budget uncertainties and preferred to book profit.

The index dived to intra-day low of 171 points in the initial hour but managed to make some recovery at the close. Trading volume clocked in at 149 million shares of Rs6.6 billion value, down from 200m shares worth Rs10.8bn traded the day earlier.

Foreign investors were net sellers of $1.32m stocks, with big pull back from oil and gas sector. Institutional investors also stayed on the sidelines awaiting the budget.

Due to the proposed gas tariff hike, share prices of gas distribution companies Sui Northern Gas and Sui Southern Gas rose by 5pc and 1.9pc.

Major news flow included finance minister’s decision to withdraw tax exemptions worth Rs180bn in the budget FY16 and the Federal Board of Revenue proposal to increase Capital Gain Tax (CGT).

Analyst Muhammad Mobeen commented that the fertiliser sector remained depressed as the government expressed its intent to impose uniform GIDC rate on old and new fertiliser plants in view of the ruling issued by the Competition Commission of Pakistan.

Cement sector remained in the red zone, while banks were mixed after showing some recovery a day ago.

Analyst Ahsan Mehanti at Arif Habib Corp stated that profit-taking was witnessed in selected stocks across the board on concerns over the falling banking spreads and uncertainty over the budget.

Weak global crude prices played a catalyst role in bearish activity amid late session support in leveraged stocks.

Published in Dawn, May 29th, 2015

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