Pakistan Stock Market Sheds 148 Points on Interest Rate Hike Reports

Pakistan Stock Market Sheds 148 Points on Interest Rate Hike Reports

Karachi, September 11, 2023 – The Pakistan stock market experienced a sharp decline on Monday, with the benchmark KSE-100 index of the Pakistan Stock Exchange (PSX) shedding 148 points. This drop in the index, which ended at 45,865 points, marked a significant departure from last Friday’s closing figure of 46,013 points.

Market analysts at Ismail Iqbal Securities attributed this decline to growing concerns among investors regarding an imminent interest rate hike. The anticipation of such a move prompted bearish sentiments throughout the trading day.

READ MORE: Share Investors to Stay Cautious Ahead of Monetary Policy Announcement

The Monetary Policy Committee (MPC) of the State Bank of Pakistan (SBP) is scheduled to convene on September 14, 2023, to discuss and potentially announce changes to the interest rates. This looming decision has cast a shadow of uncertainty over the stock market, leading to increased volatility and apprehension among traders.

Trading volumes saw a notable increase today, with 211 million shares changing hands compared to the 149 million shares traded in the previous session. This surge in trading activity reflects the heightened market activity driven by interest rate concerns.

READ MORE: Pakistan Stock Market Gains 256 Points Amid Thin Volumes

Meanwhile, analysts at Topline Securities noted that market sentiment remained subdued as investors opted for a cautious approach throughout the day. However, the energy sector stocks attracted considerable attention due to the anticipation of an announcement regarding Gas Tariff hikes.

Among the sectors contributing negatively to the index, banks, fertilizer, and exploration and production (E&P) sectors were notable. Companies like United Bank Limited (UBL), ENGRO, Pakistan Oilfields Limited (POL), MCB Bank (MCB), and Habib Bank Limited (HBL) collectively dragged the index down by 148 points.

READ MORE: Pakistan Equities Witness 50 Points Decline Amid Rising Interest Rate Concerns

Conversely, there were some bright spots in the market, with Pakistan Petroleum Limited (PPL), Sui Northern Gas Pipelines Limited (SNGP), and Pakistan Stock Exchange Limited (PSEL) gaining 81 points in total. These gains were driven by renewed buying interest in these particular stocks.

The Pakistan stock market is expected to remain highly sensitive to any developments surrounding the upcoming MPC meeting. Investors are closely monitoring the SBP’s decision on interest rates, as it will likely have a significant impact on market dynamics in the coming days.

READ MORE: Pakistan Stock Market Ends in Green Amid PKR Recovery

As uncertainty looms, market participants will be keeping a keen eye on economic indicators, policy announcements, and global market trends to make informed investment decisions.