Midday Report: KSE-100 index bleeds by over 2,000 points

June 23, 2022 (MLN): After the announcement of the imposition of a 10% super tax on large-scale units, the local bourse has witnessed a blood bath as the benchmark KSE-100 index lost 2,053.35 points so far [12:03 PST] and currently trading at the 40,663.62- mark or down by 4.81%.

While announcing the tax, Prime Minister Shehbaz Sharif said that it will be used to alleviate poverty in Pakistan which will be funded by large industries.

According to Fahad Rauf, Head of Research at Ismail Iqbal Securities, “The steps being taken reflect the state of our economy. We have been living beyond means for long and bailouts are getting increasingly difficult.”

He said that tough steps are the need of the hour however burdening the existing taxpayers is not the way out, adding that the government needs to tax agriculture and real estate more aggressively, he added.  

Shayan Jan, Equity Trader at Intermarket Securities told Mettis Global, “The market was knocked by the imposition of super tax on large industries. It is expected that market will fall further and might witness a halt in next session.”

Investors have reacted negatively to the current development regarding supertax and its impact will continue until further clarification, Ahsan Mehanti, Director of Arif Habib Group said.

The super tax has been imposed on the sectors such as cement, steel, sugar, oil and gas, fertilizer, LNG terminal, textile, banks automobiles, tobacco, beverages, and chemicals.

Meanwhile, the absence of fresh inflows and fast depleting foreign exchange reserves have further crushed the investors’ sentiments.

Sector-wise, the index was let down by sectors such as Fertilizers, commercial banks, cement, and oil & gas exploration companies as they have lost 382, 303, 211, and 300 points, respectively.

Company-wise, the scrips of FFC, ENGRO, HUBC, OGDC, LUCK, and EFERT remained the major losers.

Copyright Mettis Link News