Pakistan stocks hit four-year high; rupee weakens
ISLAMABAD: Pakistan’s main stock market rallied on Monday to close at a four-year high as investors cheered the central bank’s decision to cut its key policy rate, analysts said.
The Karachi Stock Exchange benchmark 100-share index gained 150.48 points, or 1.02 per cent, to close at 14,911.97, its highest close since May 2008, on volume of 143.42 million shares.
“The main reason for the positive trend in the market today was the State Bank (of Pakistan) announcement Friday evening of a 150-basis point cut in the discount rate,” said Atif Zafar, a research analyst at the JS Global financial services company.
“This was above market expectations. The market was expecting a cut of 50 to 100 basis points.”
The State Bank of Pakistan in its monetary policy announcement on Friday lowered its key policy rate from 12 per cent to 10.5 per cent. In the currency market, the rupee weakened to close at 94.42/48 to the dollar, compared with 94.12/19 on Friday.
Overnight rates in the money market closed lower at 10.40 per cent, compared with 11.90 per cent on Friday.