Daily Times

Bullish trend dominated at the 100-index of the Pakistan Stock Exchange (PSX), as it witnessed historic single-day gain of 2,446 points on Monday, a positive change of 5.90 per cent, closing at 43,899.01 points against 41,452.69 points the previous trading day.

Following the agreement with the International Monetary Fund (IMF), a total of 381,904,794 shares were traded during the day as compared to 234,748,468 shares the previous day, whereas the price of shares stood at Rs.8.647 billion against Rs. 7.476 billion on the last trading day.

As many as 357 companies transacted their shares in the stock market; 315 of them recorded gains and 36 sustained losses, whereas the share price of 6 companies remained unchanged.

The three top-trading companies were WorldCall Telecom with 54,999,792 shares at Rs.1.23 per share; K-Electric Ltd with 30,596,397 shares at Rs.1.96 per share and Cnergyico PK with 22,447,095 shares at Rs.3.18 per share. Nestle Pakistan witnessed a maximum increase of Rs.152.50 per share price, closing at Rs.6,600.00, whereas the runner-up was Colgate Palm with an Rs.76.90 rise in its per share price to Rs.1,199.72. Pak Engineering witnessed a maximum decrease of Rs.24.34 per share closing at Rs.300.21; followed by ZIL Limited with Rs.22.50 decline to close at Rs.277.50.

Salman Naqvi, the head of research at Aba Ali Habib Securities, attributed the surge to the staff-level agreement with the Fund for a $3 billion stand-by arrangement. “This is a very good agreement,” he said, expressing the hope that it would also help the local currency to recover. He said that agreement would also pave the way for the release of funds from multilateral and bilateral donors. He said that the country’s economy had been granted “breathing space”, the effects of which were being witnessed on the stock market. Ali Malik, CEO of First National Equity, also attributed the rally to the IMF agreement. “Investors were previously nervous and fearful of doubts that the country might default or could go through very tough economic times. Now they can see a direction of stability going forward,” he said.

Pakistan had secured a badly-needed $3bn short-term financial package from the IMF on Friday, giving the economy a much-awaited respite as it teeters on the brink of default. The deal — subject to approval by the IMF board in July — came after an eight-month delay and offers some respite to Pakistan, which is battling an acute balance of payments crisis and falling foreign exchange reserves. The $3bn funding, spread over nine months, was higher than expected as Islamabad was awaiting the release of the remaining $2.5bn from a $6.5bn bailout package agreed in 2019, which expired last week.

Meanwhile, Prime Minister Shehbaz Sharif congratulated the nation and the business community on the rally in the stock market. In a statement, he said that because of the government’s “hard work and sound policies”, there were signs of economic recovery. He said that the country had “once again” turned towards the path of development, adding that investor confidence had been restored after the standby agreement with the IMF. PM Shehbaz also vowed to rid the masses of inflation and promised employment for the youth.