Stocks fall like house of cards, index plunges 1,135 points.

KARACHI -- Share prices dropped across the board in the first post-budget session on the back of higher inflation expectations.

The KSE-100 index took a plunge from its pre-budget level as investors appeared apprehensive about the adverse budgetary measures of increasing the tax rates on banking sector profits to 42pc from 39pc and an additional 3pc super tax announced for the fiscal year, said Arif Habib Ltd.

Moreover, the rupee continued its decline against the dollar as the interbank rate closed at 203.86. The banking sector stayed in the red zone in particular due to harsh taxation measures proposed through the money bill. Institutional investors remained on the selling side because of the redemptions arising from mutual funds whose investors have been deprived of tax credit in the latest budget.

As a result, the KSE-100 index settled at 40,879.93 points, down 1,134.8 points or 2.7 per cent from a day ago.

The trading volume increased 41.4pc to 163.8 million shares while the traded value went up 41.8pc to $21.4m on a day-on-day basis.

Stocks contributing significantly to the traded volume included Hum Network Ltd (24.56m shares), Cnergyico PK Ltd (6.89m shares), K-Electric Ltd (6.52m...