PSX weekly roundup: market stays flat as investors await monetary policy decision

KARACHI: Pakistan Stock Exchange (PSX) concluded the week nearly unchanged, with the KSE-100 Index closing at 78,897.72, reflecting a marginal rise of 410 points or 0.5 per cent in both local currency and dollar terms, as per Mettis Global.

Investors are now focused on the upcoming monetary policy meeting set for September 12 (Thursday). The State Bank of Pakistan (SBP) is expected to reduce the policy rate for the third consecutive time. The central bank has already reduced rates by a total of 250 basis points in its last two meetings.

PSX shows mixed performance, gains slightly amid low trading activity

This space for monetary easing has been offered by a marked decrease in inflation, which recently dropped to single digits for the first time in almost three years. SBP’s Monetary Policy Committee (MPC) is expected to use the opportunity to boost economic growth by reducing interest rates.

At the same time, market participants are awaiting the International Monetary Fund’s (IMF) board approval for the $7 billion loan agreement signed in July. Both, Prime Minister Shehbaz Sharif and Finance Minister Muhammad Aurangzeb, have reaffirmed that the government is working to meet the conditions set by the IMF to finalise the programme. One of the avenues under consideration in this regard are loans from Middle Eastern banks, the finance minister shared.

Throughout the week, the benchmark KSE-100 index traded within a 1,014-point range, hitting a high of 79,254 and a low of 78,240.

Stock market gets a boost by hopes of policy rate reduction, IMF approval

PSX recorded an average trading volume of 675.46 million shares worth Rs 14.57 billion. This represents an 11.8 per cent increase in the number of shares traded but a 22.4 per cent decline in value compared to the previous week.

Market capitalisation for the week dropped by $33.04 million, or 0.1 per cent, to $37.61 billion. In local currency terms, the market capitalisation stood at Rs 10.48 trillion, Mettis Global said.