Equities staged a rally at the Pakistan Stock Exchange (PSX) as the Supreme Court's Thursday verdict on the no-confidence motion and monetary action from the central bank reversed investor sentiment. The benchmark KSE-100 Index ended the final session of the week up 658 points, while both volume and value of shares traded improved.

“Clarity on the political front post the Supreme Court’s decision and rise in interest rate by the State Bank of Pakistan (SBP) acted as positive triggers for investors,” said Capital Stake.

Bolstered by positive sentiment, equities remained in the green throughout the day, reaching an intra-day high of 44,507.62 an increase of 720.79 points.

At close on Friday, the benchmark index ended at 44,444.58, registering a gain of 657.75 points or 1.50%. On a weekly basis, the index recorded a drop of 1.57% despite the increase on the last day of the week.

“The market is reacting positively to clarity on the political front,” Sana Tawfik, vice-president research and a senior analyst at Arif Habib Limited, told Business Recorder.

On Thursday, the Supreme Court rejected the ruling of the National Assembly Deputy Speaker regarding the no-confidence motion against PM Imran Khan and restored the National Assembly, stating the PM's advice to the president to dissolve the NA was contrary to the Constitution and of no legal effect.

The speaker was also asked to hold a session of the NA immediately and not later than 10:30am on Saturday, April 9, 2022, to conduct the business of the House as per the Orders of the Day that had been issued for 03 April 2022.

Tawfik said that the rupee, which was on a record depreciation spree and had dropped to a low of 188 against the US dollar, also recovered amid positive developments. “There is an overall positive sentiment in all markets,” she said.

Meanwhile, the Monetary Policy Committee (MPC) of the State Bank of Pakistan (SBP) in its emergency meeting on Thursday decided to increase the key policy rate by 250 basis points (bps) to 12.25% to address risks to inflation and external stability.

The committee believed that this strong and proactive policy response was necessitated due to the deterioration in the outlook for inflation and an increase in risk to external stability since the last meeting.

The meeting of the MPC was scheduled for April 19, 2022. However, sensing the situation of the economy, the committee decided to meet early and take a decision on the policy rate. The committee meeting was chaired by Governor SBP Dr Reza Baqir.

“Apart from a policy rate hike, SBP’s import curtailment measures were also done at the right time,” said Tawfik.

The SBP on Thursday also announced a 100% cash margin on the import of 177 items with immediate effect, to reduce the pressure on the exchange rate.

On the corporate front, Ghani Global Glass Limited informed the bourse that it has successfully set up and fired its 25 TPD (tons per day) second (2nd) furnace for manufacturing of glass tubing. “By setup of the second furnace, production capacity of the plant has increased by 125%,” read the notice.

Sectors pushing the benchmark KSE 100 upward included banking (318.40 points), oil and gas exploration (83.74 points) and cement (47.77 points).

Volume on the all-share index increased significantly to 227.88 million from 141.01 million on Thursday. The value of shares traded also improved to Rs6.79 billion from Rs4.98 billion recorded in the previous session.

Telecard Limited was the volume leader with 19.72 million shares, followed by Ghani Global Holdings with 17.72 million shares, and Treet Corporation with 16.88 million shares.

Shares of 325 companies were traded on Friday, of which 235 registered an increase, 72 recorded a fall, and 18 remained unchanged.