- The intraday high saw the KSE-100 index peak at 115,773.39.
- The closing level recorded a decline to 114,495.70 points.
- The KSE-100 index fell 308.46 points, or -0.27%.
The capital market ended in the red on Tuesday, ending a three-day rally as investor sentiment improved amid expectations of another rate cut by the State Bank of Pakistan (SBP) and earnings Positive corporate earnings gave way to selling pressures.
The index hit an intraday high of 115,773.39, gaining 969.23 points, or 0.84 percent, but fell in the second half of the session to a low of 114,298.29.
At the end of the session, the index recorded a decline of 308.46 points, or -0.27%, from the previous close of 114,804.16, closing at 114,495.70. The decline highlighted the market’s difficulty in maintaining its initial gains amid mixed investor sentiment.
This decline comes despite optimism surrounding a possible easing of monetary policy and encouraging corporate results.
Talk to Geo.tv Samiullah Tariq, Head of Research at Pak-Kuwait Investment Company, said: “The market is rising in anticipation of further rate cut and positive corporate results. »
With inflation showing a sharp decline, market participants are expecting a potential rate cut at the first meeting of the SBP’s Monetary Policy Committee (MPC) of 2025, scheduled for January 27.
Inflation fell to 1.8% year-on-year for the week ending January 9, its lowest level since October 2014, further fueling hopes for an accommodative monetary policy.
Economic developments provided the backdrop to the session, with the World Bank (WB) pledging $40 billion in financing for Pakistan under its Country Partnership Framework (CPF) over 10 years.
According to sources within the Ministry of Economic Affairs, $20 billion will be provided through the International Development Association (IDA) and the International Bank for Reconstruction and Development (IBRD), while $20 billion additional dollars will come from the International Finance Corporation (IFC).
Specific goals include increasing tax revenue to 15% of GDP, adding 10 gigawatts of renewable energy capacity, providing quality education to 12 million students and health services to 50 million people.
In line with efforts to stabilize the economy, the federal cabinet approved revised agreements with 14 independent power producers (IPPs), which will result in projected savings of Rs 1.4 trillion over the life of the agreement. Annual savings of Rs 137 billion are expected, benefiting electricity consumers facing high electricity tariffs.
The revised agreements, which include profit and cost cuts totaling 802 billion rupees, aim to reduce energy costs and ease financial pressure on consumers. The government began renegotiations with IPPs late last year as part of broader efforts to stabilize the economy.
Further strengthening his economic recovery plan, Finance Minister Muhammad Aurangzeb announced plans to launch yuan-denominated Panda bonds to tap China’s capital market.
Talk to Bloomberg Television On the sidelines of the Asian Financial Forum in Hong Kong, the minister revealed Pakistan’s target of raising $200-250 million from Chinese investors in the next six to nine months.
“We were wrong as a country not to resort to this earlier,” Aurangzeb said, adding that China International Capital Corporation was advising Islamabad on the issue.
The KSE-100 index gained 574.11 points, or 0.5%, on Tuesday to close at 114,804.17, buoyed by strong valuations and reduced political noise. During the day, the index peaked at 115,044.79, while falling to 113,836.61 during intraday activity.