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KSE 100-Index drop on gas tax; rupee steady

KARACHI: Karachi Stock Exchange (KSE) closed lower on Wednesday, falling after news that parliament had approved a new tax on gas.

The Karachi Stock Exchange 100-share index fell 0.40 percent, or 130.55 points, to close at 32,599.

The new tax, called the Gas Infrastructure Development Cess, is expected to hit manufacturing sectors like fertilizer and textiles.

Officials say the tax is needed to pay for new gas import infrastructure to help overcome Pakistan’s crippling electricity shortages. But manufacturers have been running advertisements saying extra costs mean they will have to cut jobs.

Banking stocks also remained largely under pressure on expectations the central bank would announce a rate cut on Saturday amid low levels of inflation, said analyst Muhammed Mobeen of JS Global Capital.

Muslim Commercial Bank Ltd fell 1.24 percent, while Fatima Fertilizer Co ended down 5 percent.

The rupee ended nearly steady at 101.82/101.88 against the dollar, compared with Tuesday’s close of 101.84/101.89.

Overnight rates in the money market rose to 7.50 percent from Tuesday’s 6.50 percent. -Reuters

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