Daily Times

Due to an increase in inflation and expectations of an interest rate increase by the State Bank of Pakistan in its impending monetary policy announcement, the Pakistan Stock Exchange (PSX) fell on Monday.

The KSE-100 dropped 283 points, or 0.68pc, as a result of the triggers working together. The index ended the day at 41,348.19. On the all-share index, the volume of trading dwindled as investor interest also decreased. On a year-on-year basis, Pakistan’s inflation rate topped 21.3pc in June 2022, the highest since December 2008, as rising commodity prices and a weaker rupee took their toll on the local economy. The astronomical number was much beyond what the market had predicted. It has become increasingly likely that the SBP would raise the interest rate by a large margin at its next monetary policy meeting on July 7, which is currently planned for that day.

The KSE-100 opened with a shaky note, trading on both ends of the spectrum in the first few minutes. Eventually, profit-taking began to take hold, and the market began to decline. The KSE-100 index finished with a loss after the decline levelled off in the final hour. Equities in the index-heavy automotive, cement, chemical, bank, and oil industries took the brunt of the lowered confidence, and there was a significant selloff of these stocks.

Bearish mood predominated in Monday’s first trading session, according to a study from Capital Stake. The majority of the day was spent in the red, but trading volumes decreased after the closing. According to a report by Arif Habib Limited, the market remained under pressure throughout the day due to worries about rising inflation and an impending rate hike. Despite the lack of activity on the main board, the third tier stocks saw a lot of activity.

Fertilizer (72.61), cement (60.82), and oil and gas exploration were among the KSE-100’s worst components (33.20 points). On the all-share index, volume dropped from 154m to 86.6m. At Rs3.05 billion, shares were exchanged, a decrease of Rs4.03bfrom the previous session. Agritech Limited had 8.09m shares, followed by Sui Northern Gas Pipeline with 12.47m, and Pak Refinery had 4.39m.

On Monday, a total of 303 businesses’ shares were traded, with 88 seeing their prices rise, 197 seeing their prices decline, and 18 seeing their prices stay the same.