Stocks edged lower on Thursday amid market buzz that the government has decided to burden the industries with more taxes through an IMF-dictated mini-budget, traders said.
The Pakistan Stock Exchange's (PSX) benchmark KSE-100 Shares Index fell 195.06 points or 0.45 percent to 43,481.50 points after touching a high of 43,875.72 points and a low of 43,390.96 points during the session.
Darson Securities in a post-market note said sentiments remained mixed at the bourse that mostly traded in a narrow band and saw multiple spikes and declines throughout the day to conclude the undulating session on a weaker note weighed down by profit-selling.
The KSE-30 index also ticked down by 56.57 points or 0.34 percent to 16,475.63 points.
Arif Habib Ltd said profit-booking broke out later in the session and wiped all the early gains. “Only refineries and cements remained in the limelight,” the brokerage reported.
Sectors contributing to the negative performance included technology (-59.2 points), fertiliser (-33.3 points), E&Ps (-27.0 points), power (-21.8 points), and engineering (-18.8 points).
Traded shares rose by 14 million to 621.216 million shares from 607.995 million. The trading value decreased to Rs10.496 billion from Rs11.129 billion. Market capital lowered to Rs7.234 trillion from Rs7.269 trillion. Out of 347 companies active in the session, 128 fell, 200 rose, while 19 closed as they had opened.
JS Research said investors chose to book profits on the higher side, while volumes remained robust during the day as well.
“Going forward, we recommend investors to adopt a 'buy-on-dips' strategy in the banks, E&P and textile sectors,” the brokerage advised.
Bata (Pak) emerged as the top gainer by surging Rs54.89 to Rs2,000 per share, followed by Gatron Industries, which increased by Rs26.58 to Rs381.35 per share. Rafhan Maize was the worst loser as it gave up Rs539.99 to end at Rs9,660.01 per share, followed by Sanofi-Aventis, which shed Rs79 to close at Rs1,461/share.
Ahsan Mehanti, at Arif Habib Corp, said, stocks fell sharply lower on weak rupee and concerns over the government’s commitment to IMF to impose more taxes for securing the funding.
“A likely imposition of 5 percent tax on manufacturers through a mini-budget is expected before the August 29 IMF board meeting, which dampened the sentiments,” he said.
According to Mehanti, slump in global equities, a $5.175 billion services trade deficit in FY2022 and concerns over weak earnings outlook led to a bearish close.
Topline Securities said stocks couldn’t sustain the bullish moementum owing to profit-taking.
Major negative contributors were SYS, UBL, PPL, KEL, and OGDC, which cumulatively dented the Index by 122 points.
WorldCall Telecom topped the volume chart with 170.780 million shares. The stock climbed up by 14 paisas to Rs1.44/share. It was followed by Cnergyico PK with 62.882 million shares. The company closed higher by 18 paisas to Rs5.85 per share.
Other stocks that recorded significant turnover included K-Electric Ltd., Pak Refinery, P.I.A.C. (A), G3 Technologies, Hascol Petrol, Silk Bank Ltd, Waves Singer and Pace (Pak) Ltd.
Shares’ turnover in the future contracts decreased to 119.065 million shares from 129.459 million shares.