Pakistan stocks nosedive by 865 points to react policy rate hike

Pakistan stocks nosedive by 865 points to react policy rate hike

KARACHI: Pakistan stocks nosedived by 865 points on Monday in a reaction to massive increase in key policy rate.

The benchmark KSE-100 index of Pakistan Stock Exchange (PSX) fell to 41,071 points from last Friday’s closing of 42,936 points, showing a decline of 865 points.

READ MORE: Weekly Review: investors may react to surprise policy rate hike

The State Bank of Pakistan (SBP) on November 25, 2022 unexpectedly hiked the benchmark policy rate by 100 basis points to 16 per cent. It was first trading day at the PSX after the policy announcement which witnessed bloodbath session.

“A bloodbath session was witnessed at the PSX during the day,” said analysts at Arif Habib Limited.

“The State Bank of Pakistan unexpectedly raised interest rates by 100 basis points during the post-close session of the previous business day, shaking investors’ confidence,” they added.

READ MORE: Stocks trade in narrow range on last day of week

As anticipated the benchmark KSE-100 index opened in the negative zone and shed 973 points in the intraday. Investor participation remained active throughout the day, with 3rd tier stocks seeing the most activity.

Sectors contributing to the performance include Cement (-204.7 points), E&P’s (-114.8 points), Commercial Banks (-110.1 points), Fertilizer (-78.4 points), Technology & Communication (-53.5 points).

READ MORE: Pakistan stocks end flat amid political uncertainty

Volumes increased from 177.3 million shares to 244.4 million shares (+37.8 per cent DoD). The average traded value also increased by 15.1 per cent to USD 31.1 million as against USD 27.0 million.

Stocks that contributed significantly to the volumes are KEL, WTL, DFML, HASCOL, and CNERGY.

READ MORE: Political uncertainty keeps Pakistan stocks range-bound

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