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Pakistan stocks, rupee stage strong comeback on political stability hopes

PSX gains 1,700 points to close at 46,144 points while the rupee gains 0.96% against the US dollar



A stockbroker speaks on the phone during a trading session at the Pakistan Stock Exchange (PSX) in Karachi. The KSE 100-index of the Pakistan Stock Exchange (PSX) climbed 3.83 per cent, or 1,700.38 points, closing at 46,144.96 points against 44,444.58 points on the last working day. It is the highest jump since April 2020. — AFP file photo
A stockbroker speaks on the phone during a trading session at the Pakistan Stock Exchange (PSX) in Karachi. The KSE 100-index of the Pakistan Stock Exchange (PSX) climbed 3.83 per cent, or 1,700.38 points, closing at 46,144.96 points against 44,444.58 points on the last working day. It is the highest jump since April 2020. — AFP file photo
by

Muzaffar Rizvi

Published: Mon 11 Apr 2022, 5:57 PM

Last updated: Mon 11 Apr 2022, 10:24 PM

The Pakistan stock market and rupee on Monday staged a strong recovery amid hopes that new Prime Minister Shehbaz Sharif's talks with the International Monetary Funds (IMF) will bring political stability in the country.

The KSE 100-index of the Pakistan Stock Exchange (PSX) climbed 3.83 per cent, or 1,700.38 points, closing at 46,144.96 points against 44,444.58 points on the last working day. It is the highest jump since April 2020.

The rupee also staged a strong recovery against the US dollar in the inter-bank market as it recorded gains of 0.96 per cent to 182.93 compared to 184.68 on Friday. The rupee registered gains of Rs1.75 against the US dollar as the market players expect that the political turmoil will ease after the election of new government in the country.

The Pakistani currency sustained a downward trend in the past 11 months as it lost 20.13 per cent, or Rs30.66 to date, compared to the record high of Rs152.27 recorded in May 2021.

“With a fresh rise of 1.9 per cent in past two days, the Pakistani rupee has depreciated by 16.11 per cent, or Rs25.39 since the start of the current fiscal year on July 1, 2021,” according to the data released by the State Bank of Pakistan (SBP), central bank.

Focus on IMF talks

The SBP governor Reza Baqir said the country’s engagement with the IMF remains strong and the fund’s loan will unlock funds from more sources.

“The IMF demand to raise fuel and electricity prices are proving difficult in current political environment,” Baqir said during an interview with Bloomberg while cited political instability one of the key reasons for rate hike and the rupee slide.

Samiullah Tariq, head of research at Pakistan Kuwait Investment, said the new government should revive talks to restore IMF programme immediately to ensure adequate level of foreign exchange reserves to give confidence to the market.

“The new government should eliminate subsidies on fuel and electricity as well as withdraw amnesty scheme,” Tariq told Khaleej Times on Monday.

He also suggested the new leadership of the coalition government to ensure adequate level of stocks of fuel to avoid power shortage ahead of summer month.

Shares worth Rs13.36b traded

The Pakistan Stock Exchange traded 557,672,451 shares on Monday compared to the trade of 227,885,722 shares the previous day. It also traded shares worth Rs13.362 billion on the exchange compared to Rs6.785 billion traded on last trading day on Friday.

As many as 386 companies transacted shares in the stock market, 330 of them recorded gain and 45 sustained losses, whereas the share price of 11 companies remained unchanged.

WorldCall Telecom, with a volume of 140,797,500 shares, remained a top traded company. Cnergyico PK, with a volume of 40,149,171, and and Fauji Cement with volume of 18,176,500 were also among the top trading companies.

— muzaffarrizvi@khaleejtimes.com


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