Tag: market analysis

  • Pakistan’s stock market crosses 48,000 mark after two years

    Pakistan’s stock market crosses 48,000 mark after two years

    The Pakistan Stock Exchange’s (PSX) benchmark KSE-100 index soared past the 48,000 mark, reaching a 24-month high, on Monday, as investors responded to recent positive economic developments in the country. Analysts predict that the prevailing positive sentiment is likely to continue in the coming days.

    The bullish trend in the market gained momentum after Pakistan reached a deal with the International Monetary Fund (IMF). The agreement with the IMF has provided investors with renewed confidence in the country’s economic prospects, leading to a surge in market activity.

    Additionally, news on Pakistan’s mineral sector contributed significantly to the market’s gains. The announcement of favorable developments in the country’s mineral sector further boosted investor optimism and drove the benchmark index to reach new heights.

    During intra-day trade, the KSE-100 index saw a significant increase of 1,010.72 points or 2.15 per cent, culminating at 48,062.56 points. This remarkable rise marks a notable increase from the previous close of 47,076.9 points, which itself was a 21-month high.

    The impressive growth of the market has been sustained over time, as evidenced by a remarkable overall gain of more than 6,600 points (+15.9 per cent) since the staff-level agreement was reached with the IMF. The deal, which amounted to a $3 billion Standby Agreement, has been instrumental in driving investor confidence and attracting more capital to the market.

    Financial experts and market observers are optimistic about the future trajectory of the Pakistan Stock Exchange, given the positive economic indicators and recent developments in the country.

    The confidence in the market has sparked interest from both local and international investors, resulting in increased trading volumes and a positive impact on the overall economy.

  • Pakistani rupee maintains winning streak against dollar for third day to close at Rs286.73

    Pakistani rupee maintains winning streak against dollar for third day to close at Rs286.73

    The Pakistani rupee continued its upward trend against the US dollar for the third consecutive session in the inter-bank market on Thursday, appreciating by 0.09 per cent. According to the State Bank of Pakistan (SBP), the currency settled at Rs286.73 at the close, showing an improvement of Rs0.25 compared to the previous day’s rate of Rs286.98.

    In a significant development, Finance and Revenue Minister Ishaq Dar met with US Ambassador to Pakistan Donald Blome on Wednesday to discuss the economic ties between Pakistan and the United States, as well as the International Monetary Fund (IMF) loan program.

    This meeting took place following the IMF’s criticism of Islamabad’s budget proposals for the fiscal year 2023-24. Esther Perez Ruiz, the IMF’s Resident Representative for Pakistan, expressed dissatisfaction with the budget proposals, describing them as a missed opportunity to broaden the tax base. She also criticised the new amnesty scheme, stating that it sets a damaging precedent.

    Separately, Prime Minister Shehbaz Sharif stated on Wednesday that the immediate goal, with the assistance of the Special Investment Facilitation Council (SIFC), is to increase Foreign Direct Investment (FDI) in the country to $5 billion.

    On the international front, the US dollar remained close to a one-month low against a basket of currencies on Thursday. This followed Federal Reserve Chair Jerome Powell’s testimony, where he maintained his usual stance and offered little room for surprise.

    Powell’s comments to lawmakers on Capitol Hill aligned with the central bank’s previous policy meeting, indicating that further rate increases are likely if the economy continues its current trajectory. As a result, the greenback depreciated by nearly 0.5 per cent against six major peers in the previous session.

    Meanwhile, oil prices slightly declined on Thursday. Market expectations of further interest rate hikes were balanced by potentially bullish US oil inventory data, which indicated a decrease in stocks.

  • Gold price in Pakistan is currently Rs5,000 higher than global market rate

    Gold price in Pakistan is currently Rs5,000 higher than global market rate

    The price of gold continued to increase in Pakistan on Monday, following the gains of last week. According to the All Pakistan Sarafa Gems and Jewellers Association, the rate of 24-carat gold rose by Rs2,000 per tola and Rs1,714 per 10 grammes, settling at Rs237,300 and Rs203,446, respectively.

    In the international market, the gold rate declined by $5, reaching $1,972 per ounce. Throughout last week, the rate of gold experienced fluctuations in both the domestic and international markets, amidst uncertainty surrounding the raising of the US debt limit.

    If the US debt limit, which is currently capped at $31.4 trillion, is not raised, it could trigger the first-ever US default.

    According to Geo, recent volatility in the domestic gold market can be attributed to various factors, including economic and political turmoil, high inflation, and currency depreciation. In such times, people tend to prefer buying yellow metal as a safe investment and a hedge.

    On May 10, the safe-haven bullion reached an all-time high of Rs240,000 per tola, driven by increased political uncertainty following the arrest of Imran Khan, the Chairman of Pakistan Tehreek-e-Insaf (PTI). However, it subsequently dropped in line with the decline in the international rate.

    Pakistan’s gold price peaks above global market levels

    The jewellers’ body also highlighted that local gold in Pakistan is currently overpriced by Rs5,000 per tola compared to the Dubai bullion market. Consequently, the Pakistani gold market is presently more expensive than the world market.

    Data shared by the association revealed a significant jump in the price of silver, with an increase of Rs50 per tola and Rs42.87 per 10 grammes, settling at Rs2,900 and Rs2,486.28, respectively.

  • Pakistani rupee witnesses biggest single-day decline against dollar in more than two decades

    Pakistani rupee witnesses biggest single-day decline against dollar in more than two decades

    Pakistani rupee dropped significantly against the US dollar in the interbank market on Thursday, as it fell more than 9 per cent during the intraday trade. Around 1:30 PM, the dollar’s intraday quote was Rs254.75, which represents a depreciation of Rs23.86.

    According to Ismail Iqbal Securities, “This is the largest single-day decline in both absolute and percentage terms, at least since 2000.”

    Earlier in the day the local unit was trading under Rs231.

    Experts predicted that as Pakistan attempted to meet the International Monetary Fund’s (IMF) requirements to renew its bailout programme, the local currency would depreciate significantly in the coming days.

    While speaking to Brecorder, the Head of Research at Ismail Iqbal Securities Limited, Fahad Rauf, said it seems like the rupee has been let go today.

    “This is a market-driven rate,” Rauf said. “This is a sign that we are moving closer to reviving the stalled IMF programme.”

    The market expert said the development was much-needed, as capping the interbank rate only led to the creation of the grey market. He said that the development will improve the greenback supply to a significant extent.

    On Wednesday, the rupee registered a loss for the 26th successive session against the dollar to settle at Rs230.89, a decrease of Re0.49 or 0.21 per cent.

    Pakistani rupee on Thursday fell 9.61 per cent or Rs24.54 to a shocking all-time low of Rs255.43, according to the State Bank of Pakistan (SBP).

  • SBP’s foreign exchange reserves dropped to $7.83 billion

    SBP’s foreign exchange reserves dropped to $7.83 billion

    Owing to debt payments, the State Bank of Pakistan’s (SBP) foreign exchange reserves fell to $7.83 billion as of August 5 from $8.385 billion in the last week.

    It is worth noting that this is the lowest level in over three years, according to figures released by the SBP.

    Pakistan’s overall foreign exchange reserves were $27.067 billion as of August 2021 but fell to $13.561 billion as of August 5, 2022.

    The most recent figures on the country’s foreign exchange holdings came when the reserves were quickly running out due to a $6 billion IMF programme that was stalled and the country was experiencing a lack of external funding.

    Due to debt payments and a lack of external finance, the central bank’s foreign reserves decreased by $555 million or 6.6 per cent every week.

    To reach $13.561 billion, Pakistan’s total liquid foreign reserves decreased by $648 million, or 4.6 per cent, and its commercial banks’ holdings fell by $5.730 billion, or 1.6 per cent.

    The SBP’s reserves are sufficient to cover imports for just over a month, according to The News. The reverse decline was brought on by paying off foreign debt.

    According to the central bank, debt repayments may slow down over the following three weeks of this month.

    On the other hand, the Pakistani rupee continued its upward trend against the US dollar for the ninth day, adding Rs3.38 to trade at Rs215.50 in intraday trade on Friday. The KSE-100 index likewise witnessed an increase of 386 points.