Karachi, February 10, 2023 (PPI-OT): KSE100 gains 3% WoW over prospects with IMF

Positive news flows helped lift the market this week as IMF and GoP talks over the 9th review entered final stages. Increased focus of the govt. to work toward pending reforms like higher taxation measures and appropriate steps toward energy tariffs for the completion of the review within the stipulated timeframe instilled confidence among investors. On the last trading day, Finance Minister’s statement regarding no commitment on settlement of outstanding gas circular debt, limited OGDC and PPL’s week’s gains. The week ended with confirmation of receipt of MEFP by the Finance Ministry. KSE100 Index closed at 41,742, up 3.1% WoW.

During the week, government raised Rs464bn through Market Treasury Bills auction against a target of Rs800bn, with yields on short-term paper rising by 6bp compared to the previous cut-off. Moreover, State Bank of Pakistan’s (SBP) forex reserves witnessed another dip, declining below US$3bn (a 9-year low). The week witnessed appreciation of PKR against USD, closing 3% WoW higher (+Rs7.3) at Rs269.3/US$, as opposed to 5% devaluation recorded last week. PSMC raised car prices during the week owing to shortage of raw material supply. According to APCMA’s press release, cement dispatches remained dull during 7MFY23 declining by 18% YoY to 25.8mn tons.