KARACHI
\nPakistan Stock Exchange (PSX) made decent recovery last week as the central bank kept the policy rate unchanged and later clarified that that there will not be more hikes in the interest rate, besides rupee\u2019s consistent appreciation against the US dollar and the announcement of general elections\u2019 date.
\nThe benchmark KSE-100 Index gained 667.64 points (+1.46 percent) on a week-on-week basis to close at 46,421.15 points from 45,753.51 points. The index shed 259.97 points (-0.56 percent) in the preceding week. However, the index has gained 4,967.17 points since the Staff Level Agreement (SLA) was signed with the International Monetary Fund (IMF) on June 30.
\nThe bourse started the week on a positive note and gained around 50 points on Monday and 107 points on Tuesday owing to support from the swift recovery of the rupee and the central bank\u2019s decision to leave its policy rate unchanged at 22 percent. The government\u2019s crackdown on currency smugglers continued in a bid to stabilise the exchange rate.
\nHowever, the market lost some ground in directionless trading as the mounting debt and surging power tariff dented investors\u2019 confidence. The bourse turned around on Thursday and gained 313 points as the Asian Development Bank forecast that Pakistan\u2019s economy would stabilise after polls and reforms.
\nThe Election Commission of Pakistan (ECP)\u2019s announcement that polls would be held in the last week of January 2024 also lent key support to the market. The stock market breached the 46,000-point barrier on Thursday, showing a sign of the sustained upward trend in the market.
\nThe index extended its rally on Friday and gained 219 points, driven higher by the rupee\u2019s continuous strengthening and $56 million increase in the country\u2019s foreign exchange reserves.
\nThe benchmark index is likely to test the 47,000-47,200 resistance level in the coming days. This breakthrough was driven by some positive pieces of news, which boosted market confidence. Concerns over an extended postponement of the general election have been allayed by the Election Commission\u2019s recent declaration that the elections are scheduled for the final week of January 2024. Investors have expressed relief over this news, which has caused a spike in positive sentiment.
\nThe market analysts attributed the market\u2019s recovery to appreciation of the rupee, ECP\u2019s statement about general elections and partly to a statement of Barrick Gold Corp CEO where he highlighted the newfound interest in developing the $7 billion Reko Diq gold and copper mine in Balochistan.
\nDuring the week, the rupee continued to gain ground and closed at 295 per dollar in the open market, gaining 1.6 percent on a week-on-week basis. It came as the State Bank undertook measures to enforce regulations against the unauthorized currency dealers.
\nOn the economic front, the large-scale manufacturing sector posted a 1.1 percent year-on-year decline in output for July 2023. Though the data remained in the red for the 11th consecutive month, the pace of decline slowed down. In the treasury bills\u2019 auction held during the week, the central bank sold three, six and 12-month treasury bills at lower yields compared to the previous auction, reflecting the market\u2019s expectation of a decrease in inflation in the coming months. Three-month bonds attracted the most interest where yields fell by 1.71 percent.<\/p>\n","protected":false},"excerpt":{"rendered":"
KARACHI Pakistan Stock Exchange (PSX) made decent recovery last week as the central bank kept the policy rate unchanged and later clarified that that there will not be more hikes in the interest rate, besides rupee\u2019s consistent appreciation against the US dollar and the announcement of general elections\u2019 date. The benchmark KSE-100 Index gained 667.64 […]<\/p>\n","protected":false},"author":2,"featured_media":312795,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[],"class_list":{"0":"post-358115","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-business"},"yoast_head":"\n