Pakistan: Gold falls, rupee strengthens, stocks slide

KARACHI: Gold prices fell in both international and local markets on Monday, while the Pakistani rupee edged up against the US dollar and the Pakistan Stock Exchange (PSX) suffered a decline amid selling pressure and heightened global economic and geopolitical concerns.

According to rates released by the All-Pakistan Gems and Jewellers Sarafa Association (APGJSA), the price of 24-karat gold declined by Rs2,400 per tola to Rs463,136.

The price of 10-gram gold fell by Rs2,058 to Rs397,064, while 22-karat gold declined by Rs1,887 to Rs363,988 per 10 grams.

In the international market, gold fell by $24 to $4,406 per ounce.

Silver prices also declined, with the price per tola falling Rs39 to Rs7,059, while 10-gram silver decreased by Rs34 to Rs6,051. International silver was down 39 cents at $65.80 per ounce.

The international decline in gold came as stronger-than-expected US employment data increased expectations of a Federal Reserve rate hike at its September 16 meeting.

Reuters reported that traders were pricing in a 58 per cent chance of a rate hike, up from 50 per cent before the jobs data was released. Higher interest rates tend to weigh on gold because the precious metal does not offer interest income.

Rupee gains against dollar

The Pakistani rupee strengthened marginally against the US dollar in the interbank market on Monday.

The dollar closed at Rs277.40, compared with Rs277.41 in the previous session, registering a one-paisa decline, according to the State Bank of Pakistan.

The central bank’s M2M revaluation rate for September 7 stood at Rs277.4018.

Stocks tumble

The benchmark KSE-100 Index fell 1,692.74 points, or around 1 per cent, to close at 173,636.07 points.

The market came under sustained selling pressure after opening on a positive note and briefly reaching an intraday high of 175,353.67 points. Selling intensified during the second half of the session.

Selling was witnessed across key sectors, including automobile assemblers, cement, commercial banks, oil marketing companies and refineries.

Index-heavy stocks including ARL, HUBCO, PSO, FFC, MEBL, NBP and UBL remained under pressure.

The decline came against a backdrop of heightened geopolitical uncertainty and rising international oil prices. Brent crude rose to around $96.45 a barrel on Monday after gaining almost 10 per cent last week, while US crude climbed to $91.85.

The KSE-100 had already lost 1.3 per cent last week as renewed US-Iran military tensions and higher oil prices raised concerns over inflation and Pakistan’s external account.

Overall, Monday’s trading reflected mixed sentiment across Pakistan’s financial markets, with a weaker gold price and a marginally stronger rupee contrasting with a sharp correction in equities.