KARACHI:- The benchmark KSE-100 index crossed 72,000 for the first time in its history on Wednesday, making a fresh move as the market cheered amid expectations of lower levels, foreign investment and progress in economic reforms, a loss situation. – Owned Enterprises (BUMN) including privatization of BUMN).
By 10:24 a.m. PST, the KSE-100 index rose 1.37 percent, or 976.49 points, at 72,335.89 percent, as the buying season continued in companies ranging from energy and cement to commercial banks and employee care food products.
Finance Minister Mohammad Aurangzeb on Monday expressed confidence that the country’s foreign reserves will reach $10 billion by June, and a new agreement with the International Monetary Fund (IMF) is expected in late June or early July.
At the same time, he said there will be no “Plan B” when a country enters the HPG program, meaning Islamabad will not back down on issues such as economic reform and broader privatization.
On Wednesday, K-Electric remained the leader with 17 million shares traded so far and PIBTL with a trading volume of over 11 million as institutional purchases fueled the market, witnessing the rise in market capitalization after years of undervalued equity. stock.
INFORMATION AND IEST good price
Amid a steady trend of improving economic performance, Pakistan recorded a current account surplus of $619 million in March 2024 against $98 million recorded in the previous month.
As Pakistan is an import-oriented economy, the current account surplus means a strong rupee, which in turn will lower inflation in the Consumer Price Index (CPI) for April, thereby raising the prospect of interest rate cuts.
The State Bank of Pakistan’s Monetary Policy Committee will meet next week on Monday (April 29) to review interest rates after witnessing a decline in the CPI over the past three months.
So while the central bank has kept the key policy rate at 22 percent, the market expects the central bank to start its rate-cutting cycle in June – high lending rates have weighed on the economy.
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The rise in commercial bank share prices is a permanent feature of the stock market boom initiated by the PTI government and supported by the watchdog, fueled by massive domestic borrowing by the government.
With the government paying back these loans at high interest rates, it is natural for commercial banks to do the same, although commercial banks do not borrow to expand existing ones or create new ones.
Read more: Government bonds are debt instruments. Higher interest rates mean higher deficits
The same is true for government bonds, which offer foreign investors the opportunity to take advantage of high returns. Pakistan has been witnessing this experience since 2018, resulting in an increase in the budget deficit.
