KARACHI: Pakistan Stock Exchange remained highly volatile during the outgoing week ended on June 07, 2024 on investor concerns over rumours that tax rates could increase in the new budget and harsh conditions of IMF for new bailout package for Pakistan.
The benchmark KSE-100 index plunged by 2,124.46 points on week-on-week basis and closed at 73,754.02 points. Trading activities also remained low as average daily volumes on ready counter declined by 5.3 percent to 423.32 million shares during this week as compared to previous week’s average of 447.01 million shares while average daily traded value on the ready counter slightly increased by 0.4 percent to Rs 17.17 billion during this week against previous week’s Rs 17.10 billion.
BRIndex100 decreased by 263.06 points during this week to close at 7,693.98 points with average daily turnover of 330.307 million shares.
BRIndex30 declined by 1,008.95 points on week-on-week basis to close at 24,691.05 points with average daily trading volumes of 210.218 million shares.
The foreign investors however remained net buyers of shares worth $4.441 million. Total market capitalization declined by Rs 266 billion during this week to stand at Rs 9.903 trillion.
An analyst at AKD Securities said that the market remained lacklustre throughout the week, with benchmark index losing 2,124points/2.8 percent WoW, closing at 73,754points on Friday.
Overall, the downward pressure was primarily driven by concerns over the potential elimination of the final tax status for CGT and dividends, which would align their tax rates with the normal income tax rate. Additionally, Moody’s statement suggesting a status quo in the upcoming MPC also exerted some pressure on the market.
Sector-wise, paper & board, jute, and textile spinning were amongst the top performers, up 18.4 percent/12.3 percent/5.0 percent WoW respectively. On the other hand, Inv. Banks/Securities Cos., E&Ps, and Refinery were amongst the worst performers with a decline of 8.6 percent/5.7 percent/5.5 percent WoW.
Flow wise, major net selling was recorded by individuals with a net sell of $8.9million. On the other hand, Insurance and banks/DFI absorbed most of the selling with a net buy of $7.0million and $6.8 million, respectively.
Company -wise, top performers during the week were YOUW (up 5.3 percent), SHEL (up 4.5 percent), MTL (up 3.9 percent), SEARL (up 3.2 percent) and TRG (up 2.8 percent), while top laggards were CEPB (down 9.3 percent), FFBL (down 8.8 percent), PSX (down 7.6 percent), PIBTL (down 7.3 percent) and OGDC (down 7.3 percent).
An analyst at JS Global Capital said that the KSE-100 witnessed extreme volatility during the last week before the FY25 Budget announcement, rescheduled now for 12th June 2024.The market lost 2.8 percent during the week over speculation about bringing rates for CGT at par with income tax for individuals. The volatility throughout the week led to the market trading in a relatively wide range of 4000+ points (low of 71.8k and high of 76.2k).
Volumes were down 5.0 during the week (in terms of shares traded) where investors preferred to book profits ahead of potential changes in CGT. The final date for budget announcement remained subject to the return of Prime Minister and the Finance Minister from their scheduled visit to China.
Copyright Business Recorder, 2024
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