KARACHI: The stock market snapped the two-day rally and once again drifted into the red on Thursday. The KSE-100 index closed with a minor decline of 75.69 points (0.19 per cent) at 40,531.13.

Although the index took off to a firm start posting an early gain of 97 points, trading remained choppy the entire day with the KSE-100 moving back and forth in the range of intraday high and low by 256 and 208 points. Foreigners sold off equity worth $3.69 million. A leading broker said that it was due to two reasons: “The slow exit of foreign funds from the Emerging Markets due to the coronavirus and their selling of stake in a Faisalabad-based entity FM Textile Mills by around $1m daily.” Corporates were lead buyers of shares valued at $1.94m.

The ongoing negotiations with the International Mone­tary Fund on its review for the second tranche dissuaded investors from taking fresh positions. However, the reported agreement between Pakis­tan and the lending institution that there would be no mini-budget or a reduction in the tax collection target till FY20 end offered some comfort.

But analysts at JS Research cautioned that some jitteriness may be seen later on in the second half as the cut-off yield of T-bills for 1-year paper had increased by 39 basis points. Further reports of the Federal Board of Revenue considering imposition of standard sales tax at 17pc on items that were currently being at a lower slab also spooked investors.

The volume increased 10pc to 197.4m shares from 180.4m while traded value decreased 6pc to reach $46m as against $49m the earlier day.

Scrip-wise, major losers were Pakistan Petroleum, declining by 1.1pc, Lucky Cement 1.5pc, MCB 0.3pc, Pakistan State Oil 1.5pc, Engro Corporation 0.1pc, Oil and Gas Development Company 0.8pc and Fauji Fertiliser 0.2pc which cumulatively took away 80 points from the index.

Published in Dawn, February 14th, 2020