Bulls hail ‘progress on govt formation’, KSE-100 up over 1.5%

After days of negativity, positive momentum marked a return to the Pakistan Stock Exchange (PSX) with the benchmark KSE-100 settling with a gain of over 1.5% on Wednesday.

During the trading session, the benchmark index hit an intra-day high of 62,432.25, up over 1,205 points.

The momentum simmered down and at close, the KSE-100 settled with an increase of 926.92 points or 1.51% at 62,153.84.

The positive momentum comes after it was learnt that Pakistan inched closer to the formation of a new government with various parties announcing their intention to join the other.

Former allies including Pakistan Muslim League-Nawaz (PML-N), Pakistan Peoples Party (PPP), Muttahida Qaumi Movement-Pakistan (MQM-P) and others on Tuesday announced to form a coalition government and also invited Pakistan Tehreek-e-Insaf (PTI) to enter “reconciliation” process for the sake of the country.

PTI says will form govts at Centre, in KP, Punjab

Additionally, Business Recorder reported that the Economic Coordination Committee (ECC) was likely to approve an increase in natural gas prices today (Wednesday) to be effective from Feb 2024.

The development bodes well for Sui Southern Gas Company Ltd (SSGCL) and Sui Northern Gas Pipelines Ltd (SNGPL), the two public sector gas utility companies, said experts.

On Tuesday, PSX staged a dramatic turnaround after plunging over 1,450 points in the opening few minutes of trading after it was learnt that the International Monetary Fund (IMF) was not onboard with the government’s circular debt plan.

After falling below the 60,000 level during the opening hours of trading, the benchmark index settled at 61,226.93, an increase of 161.61 points or 0.26%.

Globally, Asian shares tracked a negative lead from Wall Street on Wednesday, while the dollar and Treasury yields jumped as traders pared back expectations for the pace and scale of rate cuts by the Federal Reserve this year.

The latest shift in rate expectations came after an upside surprise in US inflation on Tuesday which showed the consumer price index (CPI) rising 3.1% on an annual basis, above forecasts for a 2.9% increase.

Meanwhile, on Wednesday, the rupee remained largely stable against the US dollar in the inter-bank market. At close, the local unit settled at 279.32 after a low of Re0.01 against the greenback, as per the State Bank of Pakistan.

Volume on the all-share index decreased to 303.8 million from 435.5 million a session ago.

The value of shares declined to Rs14.69 billion from Rs15.97 billion in the previous session.

K-Electric Ltd was the volume leader with 33.4 million shares, followed by Oil and Gas Development Company with 32.2 million shares, and Pak Petroleum with 15.5 million shares.

Shares of 342 companies were traded on Wednesday, of which 267 registered an increase, 56 recorded a fall, while 19 remained unchanged.