Friday, the capital market continued its upward trajectory, supported by increasing expectations of a rate drop at the next meeting of the Monetary Policy Committee (MPC) and foreign purchases, in particular in the cement sector .
Positive developments, including a billion dollars’ loan from Middle East banks and optimism surrounding the business’s profits season, have also contributed to the resumption of the market.
The KSE-100 index of Benchmark Kse-100 of Pakistan Stock Exchange (PSX) won 842.69 points, or 0.74% to end at 114,880.48 after reaching an intradible summit of 115,779.05 points .
“The expectations of a drop in rates on Monday was reinforced after the drop in yields yesterday. This, as well as a new billion dollars of banks in the Middle East and purchases by foreigners, especially In the cement sector, help the market to recover, “said Ismail Iqbal Securities PDG Ahfaz Mustafa.
He added that the current results season also stimulated the purchase activity while investors provide for dividend ads.
On Wednesday, the government raised RS326 billion thanks to an auction of the Treasury Bill (T-Bill), although it was below the target of 350 billion rupees. TV yields have decreased by 20 to 41 base points, strengthening expectations of a decrease of 100 points within the SBP policy rate, scheduled for Monday, January 27.
Inflation in Pakistan should continue its downward trend, the consumer price index (ICC) in January, potentially lowering 2.8% – the lowest level since November 2015. According to JS Global, this drop is largely due to a high basic effect despite a modest modest increase per month of 0.6%.
Average inflation for the first seven months of fiscal year 25 is projected at 6.7%, significantly less than 28.7% recorded during the same period last year.
Meanwhile, Pakistan’s exchange reserves held by the State Bank of Pakistan (SBP) decreased $ 276 million to $ 11.449 billion on January 17, allocated to external debt reimbursements. The reserves remain sufficient to cover more than two months of imports.
However, the pressure on reserves was attenuated last week when the United Arab Emirates confirmed the overthrow of $ 2 billion in depots for another year.
Thursday, Prime Minister Shehbaz Sharif welcomed the launch by the World Bank of its national partner framework of several billion dollars for Pakistan, which extends out of 26 to financial year 35. He described it as “intervention As a timely manner ”to meet the economic, poverty and climate challenges of Pakistan. This initiative should support vital development projects across the country.
In addition, the water decision to reverse the government’s deposits and efforts to guarantee short-term loans from the banks of the Middle East have provided essential budget relief.
The Minister of Finance Muhammad Aurangzeb recently confirmed a loan agreement of $ 1 billion with two Middle East institutions at interest rates from 6% to 7%. The loans were short -term – or up to a year.
Actions were also restored on Thursday, the Benchmark KSE-100 index winning 594 points, reflecting the optimism of investors concerning the monetary easing of this month. The index closed at 114,037.79 points, up 0.52% compared to the closure of the previous session of 113,443.43 points.
The announcement of the future monetary policy of the SBP remains a focal point for market players. Investors are optimistic about additional monetary easing, supported by the drop in inflation and the decrease in yields.
The MPC meeting will take place on Monday January 27. Later, the same day, Governor SBP Jameel Ahmad will announce the decision of monetary policy during a press.