WEEKLY REVIEW: Bullish sentiments dominate Karachi stock market

KARACHI: Bullish sentiments continued to dominate the Karachi stock market on account of positive developments.

Analysts said the positive developments include intense investor interest as brokers’ issues of removing withholding tax on sale of securities, minimal audit on federal excise duty collection and PTR adjustment against tax were amicably addressed by Adviser to PM on Finance, Shaukat Tarin and Securities and Exchange Commission of Pakistan’s officials on their visit to the market.

The Karachi Stock Exchange (KSE) 100-share index gained 31.38 points or 0.4 percent to close at 7,502.66 points as compared to 7,471.28 points at the close of week.

Analysts said that expectations of reduction in discount rates next week and renewed interest of retail and institutional investors helped to keep the market in the green zone.

The turnover was recorded at 124.81 million shares as compared with 181.54 million shares of the previous week, reflecting a decrease of 31.24 percent.

“Revision of petroleum prices twice, National Investment Trust (NIT) dividend announcement, news of return of deliverable futures remained the major highlights during the week,” said analyst at JS Research Mustafa Bilwani. “Supreme Court on Tuesday ordered removal of carbon tax on POL products, resulting in 15-19 percent decline in prices.”

However, in a bid to fill the revenue gap and meet IMF targets, the government via a presidential order decided to impose a fixed Petroleum Development Levy charge. As a result, the POL prices reverted to their original levels. Despite no major impact on OMC and refinery margins, price volatility kept investors concerned. Outcome of International Monetary Fund review and 1QFY10 monetary policy statement are expected to be the key triggers. link....