KSE-100 gains 1,429 points to close at 164,467 despite rate hike
The KSE-100 Index rose 1,428.73 points, or 0.88%, to close at 164,467.20 on Tuesday. Investors looked past the State Bank's 50 basis point rate increase amid easing oil prices.
For information only, not investment advice. Prices change quickly: check the time and source of every figure.
- KSE-100 closed at 164,467.20, up 1,428.73 points or 0.88%
- The State Bank raised its policy rate by 50 basis points to 12%
- Trading volume was 401.9 million shares, worth Rs18 billion
The Pakistan Stock Exchange extended its winning streak on Tuesday, with the benchmark KSE-100 Index staying in positive territory through the session. According to The Express Tribune, the index added 1,428.73 points, or 0.88%, to settle at 164,467.20. TechJuice reported the previous close as 163,038.47.
During the session the index touched a high of 164,787.67 and a low of 163,545.70, according to The Express Tribune. Buying was seen in cement, commercial banks, oil and gas exploration companies and oil marketing companies. MCB Bank, Fauji Fertiliser, UBL, Pakistan Petroleum and NBP were among the main contributors.
The gains came even though the State Bank of Pakistan raised its policy rate by 50 basis points to 12%, effective Tuesday. The Express Tribune said the increase had raised concerns over borrowing costs, but buying in heavyweight sectors kept momentum positive.
Oil prices also played a role. International prices fell on hopes of easing hostilities in the Middle East, including progress towards resolving the war involving the United States, Israel and Iran. Minute Mirror reported Brent crude futures down 0.86% at $114.81 a barrel and US West Texas Intermediate at $100.88. Renewed attacks on Saudi Arabia and on shipping kept investors wary, and prices stayed near six-month highs, the Tribune reported.
Trading volume rose to 401.9 million shares from 376 million on Monday, and the value of shares traded was Rs18 billion. Shares of 497 companies were traded in the ready market: 282 closed higher, 170 fell and 45 were unchanged. K-Electric led by volume with 54 million shares, rising Rs0.15 to close at Rs5.80.
Ahmed Sheraz of KASB KTrade said the session was supported by buying in commercial banks, cement, fertiliser and automobiles. He noted Brent crude was trading around $115-116 a barrel, raising concerns over imported inflation, while high domestic inflation and the rate increase may continue to weigh on sentiment.
Sheraz said the market is expected to stay mixed to cautious, with corporate earnings, oil prices, geopolitical developments and macroeconomic indicators likely to set direction. He said volatility is expected to remain elevated. The Tribune also cited uncertainty over the Middle East, Israeli elections and the upcoming US midterm polls.
Why it matters
Share prices affect investors and savers in Pakistan, and the State Bank's rate increase raises borrowing costs for businesses and households. Oil prices also feed into imported inflation.
