KSE-100 index gains 27.40 points
KARACHI: Stocks extended gains on Friday amid hopes that the government will announce the removal of a capital gains tax in the upcoming 2011/12 budget, dealers said.
The 2011/12 (July-June) budget is due to be unveiled on June 3.
According to media reports, the government may decide to remove the capital gains tax. A 10 percent capital gains tax is imposed on stocks held for six months or less and 7.5 percent on stocks held between 6 months to a year.
Officials from the finance ministry have declined to comment.
"There is a feeling in the market that the capital gains tax will be removed, and this is helping the sentiment," said Mohammed Sohail, chief executive of brokers Topline Securities.
"This hope is likely to keep the market positive in the sessions ahead of the budget, and if indeed the tax is removed, it should result in increased activity in the market," he said.
The Karachi Stock Exchange's (KSE) benchmark 100-share index ended 0.22 percent, or 27.40 points, higher at 12,225.22 on turnover of 79.64 million shares.
In the currency market, the rupee eased 85.65/75 to the dollar from 85.57/a day earlier, amid slightly higher dollar demand from importers.
The rupee hit a record low of 86.50 on Monday and dealers said the local unit may face pressure amid increased demand for dollar for import payments and a bleak outlook.
"There are some import payments next week, so the dollar demand would rise and the rupee will see some pressure," said a dealer at a foreign bank.
There are also concerns about the growing tensions with the West, which could choke off much needed foreign aid.
The rupee has lost more than 1.25 percent of its value since then, almost the same as its total loss of 1.53 percent in 2010.
In the money market, overnight rates edges slightly lower and closed at around 13.50 percent, compared with the previous day's close of 13.90 percent.
KARACHI: Stocks extended gains on Friday amid hopes that the government will announce the removal of a capital gains tax in the upcoming 2011/12 budget, dealers said.
The 2011/12 (July-June) budget is due to be unveiled on June 3.
According to media reports, the government may decide to remove the capital gains tax. A 10 percent capital gains tax is imposed on stocks held for six months or less and 7.5 percent on stocks held between 6 months to a year.
Officials from the finance ministry have declined to comment.
"There is a feeling in the market that the capital gains tax will be removed, and this is helping the sentiment," said Mohammed Sohail, chief executive of brokers Topline Securities.
"This hope is likely to keep the market positive in the sessions ahead of the budget, and if indeed the tax is removed, it should result in increased activity in the market," he said.
The Karachi Stock Exchange's (KSE) benchmark 100-share index ended 0.22 percent, or 27.40 points, higher at 12,225.22 on turnover of 79.64 million shares.
In the currency market, the rupee eased 85.65/75 to the dollar from 85.57/a day earlier, amid slightly higher dollar demand from importers.
The rupee hit a record low of 86.50 on Monday and dealers said the local unit may face pressure amid increased demand for dollar for import payments and a bleak outlook.
"There are some import payments next week, so the dollar demand would rise and the rupee will see some pressure," said a dealer at a foreign bank.
There are also concerns about the growing tensions with the West, which could choke off much needed foreign aid.
The rupee has lost more than 1.25 percent of its value since then, almost the same as its total loss of 1.53 percent in 2010.
In the money market, overnight rates edges slightly lower and closed at around 13.50 percent, compared with the previous day's close of 13.90 percent.