Post monetary policy: KSE-100 settles over 1,100 points higher

Pakistan stocks rejuvenated after the monetary policy announcement, with the benchmark KSE-100 Index settling nearly 1,100 points or 2.6% higher on Wednesday as investors hailed the sense of direction.

The State Bank of Pakistan's (SBP) Monetary Policy Committee (MPC) raised the key interest rate by 100 basis points (bps) to 9.75% after close of market on Tuesday, its third successive hike since September. However, many experts said the rate-hike was in line with expectations, and would give clarity to investors going forward.

Additionally, value-hunting further propelled the KSE-100 Index past the 44,000-point level.

The KSE-100 was hovering around 44,250 level after an over 1,100-point gain with around two hours left in the session. Stocks across the board gained with cement, steel, construction and auto shares leading the charge.

At close, the KSE-100 settled with a gain of 1,120.15 points or 2.59% to end at 44,366.86.

“The market is expected to react favourably to the tone of MPS communication as the central bank downplayed the need of further hikes in interest rates in the coming months. This will likely be a positive trigger for equity market as there were expectations of not only a higher jump in interest rates in this MPS, but further jumps in the future MPS announcements as well,” said AKD Securities in its latest report.

“The sentiments are also expected to improve and market may react favourably after the overhang of further hikes was removed,” added the report.

Stocks stage rally, KSE-100 up 370 points

Talking to Business Recorder on Tuesday after the MPC announcement, several analysts and market experts had said the rate-hike would now give clarity to investors.

Read the detailed story here: Interest rate hike in line with expectations, to reduce uncertainty: experts

Sectors pushing the benchmark upwards included cement (262.15 points), technology and communication (191.26 points) and oil and gas exploration (124.36 points).

Volume increased clocking in at 398.1 million on the all-shares index, up from 212.35 million on Tuesday. The value of shares traded also improved significantly to Rs11.65 billion on Wednesday, up from Rs6.77 billion.

WorldCall Telecom was the volume leader with 53.26 million shares, followed by Byco Petroleum with 34.60 million shares, and Hascol Petroleum at 19.77 million shares.

Shares of 374 companies were traded on Wednesday, of which 305 registered an increase, 60 recorded a fall, and 9 remained unchanged.