This week at PSX was shortened to just two trading sessions due to the Eid holidays. Even in this shortened week the PSX investors continued their buying spree and the KSE100 Index gained 2013 points, closing at 78,810, marking a 2.66% increase for the week.
Almost all of this rise occurred on the first trading day. On the second day, the KSE100 Index added a modest 9 points by the close. On the second and last day initially, the index surged above 80,000 within twenty-five minutes of opening, gaining over 1200 points. However, a swift selling pressure erased these gains, leaving the Index with just a 9 points increase for the day.
Despite this sheer rise and subsequent drop on the last day, the 2.66% gain for the shortened week remains significant.
The PSX has been making strides just after the announcement of the Federal Budget 2024-25 on the eve of Wednesday, June 12, 2024. The budget proposes to change the CGT regime after June 30, 2024, and end the concept of holding periods making a higher 15% tax without any holding period consideration. One of the desperate measures of the government of Pakistan among other desperate measures to boost tax revenue in an environment of weak and shrinking economy.
Since the announcement of the budget, the KSE100 Index has gained over 6,000 points, or 8.25%. But this rush to buy is to benefit from the existing CGT regime, and is not an endorsement of the budget.