News Desk
The Pakistan Stock Exchange (PSX) on Tuesday maintained its record-setting run driven by aggressive buying on improved economic outlook, helping the KSE-100 index to gain 1,011 points or 0.84 percent to reach 111,014.
Later, profit-taking set in, taking off the day’s gains in a flash.
Economic experts said that the incumbent government has set up a committee to consider increasing taxation on banks’ profits has dampened the sentiment and most banks are down over 4% already. Banks led the most recent leg of the rally, and some of those returns will be pulled back in the interim.”
The government is looking to tax bank profits derived from investments in government securities. A seven-member committee, led by Deputy Prime Minister Ishaq Dar, has been formed to review the legal framework of the banking sector’s advance-to-deposit ratio (ADR) and to foster consensus with banks. The committee is expected to finalize recommendations by December 31 to ensure revenue targets are met and propose measures to encourage private-sector lending.
Macroeconomic developments continued to support long-term optimism. Inflation dropped to 4.9% in November, the lowest since April 2018. Saudi Arabia extended its $3 billion deposit for another year, strengthening Pakistan’s foreign reserves.
Trade agreements worth $560 million with Saudi Arabia and a 25-month high in petroleum sales further signal growing economic activity. Additionally, the government raised Rs353 billion through an auction of Ijarah Sukuk, boosting liquidity.
On Monday the Pakistan Stock Exchange (PSX) achieved a significant milestone, with its total market capitalization surpassing $50 billion for the first time in history.
