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PSX gains 900 points as international oil prices decrease

IMF good news pushing up stocks: analyst

SAMAA | - Posted: Nov 29, 2021 | Last Updated: 2 months ago
SAMAA |
Posted: Nov 29, 2021 | Last Updated: 2 months ago

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The Pakistan Stock Exchange’s benchmark KSE-100 index was trading at 45,054 points Monday afternoon. The market saw a positive change last week too after a continuous decline. The index increased by more than 900 points. On November 29, analyst Raza Jafari told SAMAA Digital that the index rose by over 2%. “The monetary policy announcement last week, which revealed an increase in interest rates, sent the PSX tumbling,” he pointed out. On November 19, the State Bank of Pakistan increased the interest rate by an incredible 150 basis points to 8.75%. The decision was aimed at controlling the rising inflation in the country. Soon after the news broke out, traders expressed reservations about the interest rate increase and demanded that it should stay the same. Later, at a press conference on November 27, Special Assistant to PM on Finance Shaukat Tarin reassured that no additional tax will be imposed in the mini-budget. This encouraged investors. Jafari added that positive news regarding the resumption of the International Monetary Fund Programme will improve the index in the upcoming days. The government is hopeful that it will receive the next installment of the loan by January or February. Another analyst, Adnan Sami Sheikh, said that the price of crude oil has been on a decline in the international market. This has encouraged investors in the oil market. “Effects of the development here will soon be seen in the Pakistani market as well.” The oil prices decreased after the demand for crude oil in the international market dropped. Sheikh has predicted further recovery in the market. "If the government increases interest rate by 0.5% or 0.75%, PSX will see another 5000-point growth," he added.
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The Pakistan Stock Exchange’s benchmark KSE-100 index was trading at 45,054 points Monday afternoon.

The market saw a positive change last week too after a continuous decline. The index increased by more than 900 points. On November 29, analyst Raza Jafari told SAMAA Digital that the index rose by over 2%.

“The monetary policy announcement last week, which revealed an increase in interest rates, sent the PSX tumbling,” he pointed out. On November 19, the State Bank of Pakistan increased the interest rate by an incredible 150 basis points to 8.75%. The decision was aimed at controlling the rising inflation in the country.

Soon after the news broke out, traders expressed reservations about the interest rate increase and demanded that it should stay the same.

Later, at a press conference on November 27, Special Assistant to PM on Finance Shaukat Tarin reassured that no additional tax will be imposed in the mini-budget. This encouraged investors.

Jafari added that positive news regarding the resumption of the International Monetary Fund Programme will improve the index in the upcoming days. The government is hopeful that it will receive the next installment of the loan by January or February.

Another analyst, Adnan Sami Sheikh, said that the price of crude oil has been on a decline in the international market. This has encouraged investors in the oil market. “Effects of the development here will soon be seen in the Pakistani market as well.”

The oil prices decreased after the demand for crude oil in the international market dropped.

Sheikh has predicted further recovery in the market. “If the government increases interest rate by 0.5% or 0.75%, PSX will see another 5000-point growth,” he added.

 
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