Pakistan equities witnessed a panic-struck selling spree during the early hours of trade on Friday after Prime Minister Shehbaz Sharif announced that the government will be imposing a 10 percent “super tax” on large-scale industries in a bid to generate revenues.
The benchmark KSE-100 lost over 1,000 points after opening trade at 42,716.97. The top bourse appeared bearish from the opening bell and immediately dropped into the red zone after shedding over 1,500 points or 3.70 percent by 10 am, with fertilizer, oil & gas, and cement the top negative contributors on the bourse at the time.
During the day, it fell to intraday low of 40,555.41 losing 2,161.56 pts. It settled lower by 1,665.18 pts at 41,051.79. The KMI 30 index was down by 3,120.88 pts closing at 67,513.30. While the KSE All Share index declined by 949.18 pts ending at 28,196.03.
By midday, the top bourse had lost 2,064.9 points or 4.83 percent, with the market crashing to its lowest ever tally since December 2020.
Earlier today, PM Shahbaz imposed a super tax on top industrial arms including cement, steel, sugar, oil and gas, fertilizers, LNG terminals, textile, banking, automobile, cigarettes, beverages, and chemicals.
His speech caused the benchmark KSE-100 index to plummet before trading was suspended. It was 40,663.62 as of 12:00pm, down 4.83 percent.
Overall market volumes jumped from 348.20 million shares in the previous session to 422.49 million shares. The highest participation was witnessed in K-Electric Limited (KEL +0.35 percent), Cynergyico PK Limited (CNERGY -7.44 percent), and Pakistan Refinery Limited (PRL -7.37 percent). The scrips had 36.37 million shares, 25.81 million shares, and 25.30 million shares traded, respectively.
Sectors dragging the benchmark KSE 100 index lower included the Banking sector (404.90 points), the Oil and Gas Exploration sector (220.06 points), and the Fertilizer sector (204.99 points). Company-wise, United Bank Limited (UBL 95.60 points), Hub Power Company Limited (HUBC 94.23 points), and Engro Corporation Limited (ENRGO 80.44 points) shredded most points from the index.
The Cement sector lost 5.39 percent of its cumulative market capitalization. DG Khan Cement Company Limited (DGKC 7.20 percent), Maple Leaf Cement Factory Limited (MLCF 6.55 percent), and Bestway Cement Limited (BWCL 2.45 percent) all closed in the red.
According to Capital Stake, equity markets around the globe also showed a negative trend. Crude oil prices moved north with WTI crude oil price rising by 1.77 percent to $106.12 while Brent crude oil price was up by 1.63 percent to $111.84.