Stocks hit new peak ahead of Eid holidays
KARACHI: The stock market continued its record-setting spree for the second straight day on Friday ahead of an extended Eidul Azha closure amid optimism that the budget 2024-25 has set the ground for a positive outcome of ongoing talks with the International Monetary Fund for a new programme.
The tax-laden budget draws sharp reactions from stakeholders of almost all sectors of the economy as they believe these measures would push up the cost of doing business. However, some experts think the measures have paved the way for securing a new credit line from the IMF, which is crucial for the country to meet its debt repayment obligations and avoid a default-like situation.
Ahsan Mehanti of Arif Habib Corporation said the government’s plans to launch Eurobonds of up to $1 billion and a fresh bid for $4bn foreign bank loans, projections for a massive increase in state-owned enterprises’ dividends and privatisation proceeds in FY25 did contribute to bullish investor sentiments.
He said the investors also weighed a fall in the government treasury bond yields, rupee recovery and status quo in tax measures for filers of capital markets.
Topline Securities Ltd noted no increase in the tax rate on dividends and capital gains from the stock market for filers against market rumours, and an increase in taxes on other asset classes continued to garner investor interest in the market, propelling the index above 77,000 intraday.
However, some profit-taking was observed in the last hours as investors preferred to book their profit before the long weekend.
Banks such as Meezan Bank, MCB Bank, Bank Alfalah UBL, Bank Al-Habib, and HBL made a significant positive contribution, adding 642 points to the index.
As a result, the benchmark index hit an intraday record at 77,310.45 points and a low of 76,103.56. However, the index settled at an all-time high at 76,706.77 after adding 498.61 points or 0.65pc on a day-on-day basis. The overall trading volume plunged 37.70 per cent to 395.89 million shares. The traded value also dipped by 30.50pc to Rs21.36bn.
Foreign investors turned net buyers as they bought shares worth $1.40m.
Published in Dawn, June 15th, 2024