Early trade: KSE-100 falls by 520pts, PKR drops by 65 paisa

June 13, 2022 (MLN): The Pakistan Stock Exchange‘s KSE-100 index has lost around 520 points and is currently trading at 41,493.87 [10:25 PST] due to concerns over IMF’s program resumption.

Further, the proposed federal budget for the financial year 2022-23 announced on Friday, seemed to showcase mixed sentiments among investors.

Commercial banks have witnessed higher selling activity as they lost around 293 points, followed by Oil & Gas Exploration Companies with 67 and Cement with 42 points.

In a federal budget, the banking sector has been taxed at 42% from the current taxation of 39%. This includes the super tax amount. According to market experts, this increase in taxation could affect the sector's profitability.

In the later hours, the market is expected to recover on the back of value buying. IT, textiles, pharmaceuticals, and paper & packaging sectors are expected to fetch investors’ interest today on the back of positive measures announced in the Budget FY23, Ismail Iqbal Securities noted.

On the forex front, the Pakistani Rupee (PKR) has observed a downward slide of 65 paisa against the US dollar in early trade on the monthly decline of 25.4% in workers' remittances in May, largely reflecting the usual seasonal post-Eid decline and associated long holidays.

 The dollar was quoted at 202.91/203.91 (10:31 PST) when compared to the previous close of Rs202.35.

"Though done with the budget, the fate of the PKR move will depend on FATF & inflow news from IMF," said Asad Rizvi, former Treasury Head-Chase Manhattan Bank. 

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