Pakistan stocks jump 612 points to welcome interest rate hike

Pakistan stocks jump 612 points to welcome interest rate hike

KARACHI: Pakistan stocks jumped 612 points on Tuesday to welcome the increase in benchmark interest rate.

The benchmark KSE-100 index of Pakistan Stock Exchange (PSX) ended at 39,055 points from previous day’s closing of 38,443 points, showing an increase of 612 points.

Analysts at Arif Habib Limited said that the bulls triumphed at the PSX during the day.

READ MORE: Pakistan stocks end flat in lackluster trade

Investors celebrated after the much-needed clarity on the Monetary Policy statement, as the index opened in the green and proceeded to trade positively throughout the trading session, anticipating favorable outcomes from the IMF Program revival at a staff level meeting soon helped the index reach an intraday high of 648.11 points as investors remained active throughout the day.

A day earlier, the central bank increased the policy rate by 100 basis points to 17 per cent, slightly better than market expectation which market was expecting higher percentage increase on uptick in secondary market bond yields and rising external account concern.

READ MORE: Weekly Review: IMF talks, policy rate to move stock market

Furthermore SBP governor stated Pakistan will have to arrange $3 billion for external debt repayment for remaining part of this fiscal year, as they expect the rest of the debt repayment to be rolled over.

Volumes improved drastically across the board from the previous close.

READ MORE: Equities shed 423 points on uncertain IMF talks

Sectors contributing to the performance include E&P’s (+98.3 points), Fertilizer (+88.7 points), Cement (+81.7 points), Miscellaneous (+77.0 points), and Commercial Banks (+69.9 points).

Volumes increased from 81.3 million shares to 179.8 million shares (+121.1 per cent DoD). The average traded value also increased by 126.4 per cent to USD 27.6 million as against USD 12.2 million.

READ MORE: Pakistan stocks gain 40 points as IMF may resume talks

Stocks that contributed significantly to the volumes are PPL, MLCF, WTL, ASCR2 and OGDC.

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