Stocks pare losses after SC nods tax amnesty scheme

Stocks on Wednesday pared some of the previous day’s losses after apex court’s nod to the tax amnesty scheme, believed to help draw in foreign as well as local investors, boosted sentiments at the top bourse, dealers said.

Ahsan Mehanti from Arif Habib Corporation said stocks showed recovery led by scrips across the board after caretaker finance minister ruled out IMF option to meet looming debt obligations.

“Upbeat data on auto sales and oil production for July-May period of this fiscal, recovery in global oil prices, and rising local cement and auto prices helped the apex bourse to close higher,” Mehanti said.

Pakistan Stock Exchange (PSX) benchmark KSE 100-share index rose 0.64 percent or 278.60 points to close at 43,507.50 points, whereas KSE 30-share index improved 0.78 percent or 165.09 points to close at 21,459.63 points. Of 332 active scripts, 197 advanced, 113 declined, and 22 remained unchanged. The ready market volumes stood at 111.897 billion shares compared to 137.787 billion shares the previous session. Since morning the market was in bullish mode and the benchmark index saw fresh buying in steel, bank and fertiliser stocks. Steel stocks went up after National Tariff Commission imposed anti-dumping duties on imports from China.

The banking stocks gained on market expectation that following the rise in dollar, State Bank of Pakistan might raise interest rate in its next monetary policy announcement.

On the other hand, fertiliser stocks strengthened on hopes of a likely sharp rise in the demand of urea in the coming months as the water levels in the rivers showed some improvement last week.

The market during the session came under selling pressure from the financial institutions and some foreign fund houses, dragging the index down to a session-low of 43,217 points. However buying from high net-worth individuals and some corporates lifted the sentiment and the index closed at 43,589 points.

An analyst from Ismail Iqbal Securities said the positive sentiment was mainly driven by Supreme Court’s (SC) consent on amnesty scheme. “However, we do not expect the SC’s consent…to have much impact due to its limited time duration expiring on June 30,” the analyst said.

Furthermore, the turnover dropped to 112 million shares as compared to Tuesday’s volume of 183 million shares.

The highest gainers were Unilever Foods, up Rs314.00 to close at Rs8,099.00/share, and Island Textile, up Rs51.49 to finish at Rs1119.99/share.

Rafhan Maize, down Rs200.00 to close at Rs7998.00 and Colgate Palmolive, down Rs174.90 to close at Rs3323.06/share were among the top losers. Bank of Punjab recorded the highest volumes with a turnover of Rs10.053 million shares, while the bank’s scrip gained Rs0.29 to close at Rs13.15/share. The lowest volumes were witnessed in K-Electric Limited. It recorded a turnover of 7.091million shares, with its scrip losing Rs0.11 to end at Rs5.57/share.