KARACHI: Stock market paused for breath on Tuesday after the KSE-100 index recovered 1,987 points in the last two sessions from the 2,049 points that the index had ceded the previous week.

On Tuesday, the market traded in the range of intraday high and low by 144 and 221 points. At the close of market, the index showed a gain of 90 points, or 0.20 per cent, at 44,857.

Technology stocks took the lead among gainers, adding 124 points to the index with TRG and Systems Ltd recovering more of the losses they had suffered the previous week. They were followed by banks which contributed 60 points, fertilisers 42 points and textiles 23 points.

The cyclical favourites cement and steels came under hammering while E&Ps also stood down as international oil prices declined. Scrips that helped index keep climbing included TRG (104 points), HBL (28 points), Engro Fertilisers (21 points), Meezan Bank (19 points) and Systems Ltd (15 points).

Among participants, foreign investors and brokers proprietary trading were major sellers while mutual funds built up new position in shares worth $4.18m and insurance companies also bought shares valued at $1.15m.

Mixed signals from the political side regarding the PDM’s decision on resignations and long march kept investors guessing. The rising Covid-19 cases and partial lockdowns in certain cities also cajoled investors to take profit at higher levels.

Leverage remains high which kept investors on their toes while the monetary policy scheduled to be unveiled on Friday, stoked a debate on whether the SBP would keep policy rates unchanged at 7pc or as was widely believed previously subject it to a modest cut of 100 to 150bps.

Corporates are showing displeasure over the withdrawal of exemption on inter-corporate dividends, which, they say, would result in double taxation for the corporate sector. To comply with IMF programme conditions and raise revenue of Rs70-100bn, the upcoming bill also proposes removal of a clause that exempts dividend income of the holding company from subsidiaries where the ownership share is more than 55pc, which attracted strong criticism from captains of industries.

Published in Dawn, March 17th, 2021

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