Daily Times

karachi: Pakistan Equities closed lower in the first post budget trading session as investors negatively reacted to the implementation of single-slab CGT and higher tax on dividends.

The benchmark KSE 100 index dropped 497.97 points to settle down at 52138.90 level.

After a sideways open, the market declined steadily as participants booked profits after government increased taxes on Dividends and Capital Gains and extended Super Tax imposed two years ago on Corporates for one more fiscal year.

Meanwhile, the turnover in wider market also stood low as anxiety on domestic politics likely kept most participants on the sidelines. This was after a Joint Investigation Team tasked to probe the PM family’s offshore asset intensified its investigations by summoning the premier’s son for less than an hour, analysts at Elixir Securities reported.

The major dent came from Habib Bank HBL, Lucky Cements and United Bank while on the flip side, the Oil & Gas Development Company managed to stay in green and topped the leader boards on reported institutional buying.

Laggers on the index were HBL (-2.2), LUCK (-2.8%), UBL (-2.6%), DAWH (-2.7%) & PAEL (-3.9%), with negative contribution of 273pts, while OGDC (+0.8%), SNGP (+1.6%), MARI (+1.6%), HUBC (+0.5%) & PSMC (+1.4%) supported the index by adding 62 points.

On the sector front, Banks eroded 202 points, Cement 126 points and Fertilizer 47 points while E&P’s added 24 points and Power added 15 points, Topline Securities revealed.

The PSX has reduced regular trading hours by 01:15 hours due to Ramadan, while investor participation generally wanes in the Holy Month of abstinence. Market participation slumped with volumes falling 53% d/d to 203 million shares while traded value fell 37% to Rs13 bilion/$124 million.

Analysts expect that in future, the activity in MSCI names will pickup given EM inclusion is just a couple of days away.