Positive signs for economy
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Pakistan - 4 weeks ago

Positive signs for economy

ISLAMABAD  –   The stock market saw a bull-run on Wednesday as the KSE-100 index surged by 1195.04 points in anticipation of creation of a market support fund, which drove investor sentiments during the day.

A total of 203,498,120 shares were traded and the value of shares traded during the day stood at Rs5.342 billion, as KSE 100 index bounced by 3.57 percent to close at 34,637.14 points.

Pakistan’s rupee also registered slight gains against the US dollar in the open market. The dollar decreased by Rs1 in the open market and was being traded at Rs153.

In the interbank market however, while registering an initial decrease of Rs0.32 earlier in the day, the dollar gained Rs0.03 and closed at Rs151.95.

Of the 360 companies at the Pakistan Stock Exchange (PSX), share prices of 303 companies recorded increase while 50 companies registered decrease whereas 7 companies remained stable in yesterday’s trading.

The three top traded companies were Bank of Punjab XD with a volume of 25,080,500 and price per share of Rs 12.25, WorldCall Telecom with a volume of 20,146,000 and price per share of Rs.81 and K-Electric Limited with a volume of 15,749,000 and price per share of  Rs4.38.

The top advancer was Mari Petroleum with the increase of Rs49.23 per share, closing at Rs1034.02 while Millat Tractors XD was runner up with the increase of Rs32.82 per share, closing at Rs838.27.

Both the stock market and the rupee had been under intense pressure since last week, in the wake of a $6 billion loan accord with the International Monetary Fund. The IMF  accord, which must still be approved, foresees a “market-determined” rate for the rupee. At present, the currency – which many analysts consider overvalued – is managed by the central bank in a de facto controlled float.

The State Bank of Pakistan, which lifted interest rates by 150 basis points on Monday to 12.25 percent, said it was watching the foreign exchange market closely and would act in the case of “unwarranted” volatility.

It said the recent slide “reflects the continuing resolution of accumulated imbalances of the past and some role of supply and demand factors”.

The sliding rupee has caused alarm in Pakistan, which is already facing inflation likely to average over 7 percent for the year and surging costs for fuel and power, which are both heavily influenced by the dollar exchange rate.

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