The capital market opened the week on Monday with mixed sentiments as investors navigated between optimism over improving economic indicators and concerns about potential policy measures.
Early trading saw the Pakistan Stock Exchange’s (PSX) benchmark KSE-100 Index climb 1,148.11 points, or 0.98%, to an intraday high of 118,735.09. However, profit-taking and cautious sentiment later in the session dragged the index to a low of 115,941.94, a decline of 1,645.04 points or -1.4%.
Market pressures emerged following reports of a potential gas price hike. Ismail Iqbal Securities CEO Ahfaz Mustafa said: “The market is under pressure at midday due to the reports of gas price increase.”
“IMF has asked Pakistan to increase captive gas prices for industries which can potentially stress the balance sheets of all gas-related utilities and general industries,” he added.
The proposed levy on gas supply to industrial captive power plants (CPPs) is part of the IMF’s structural benchmarks under the $7 billion Extended Fund Facility (EFF). Compliance with these measures is critical for Pakistan to secure the next $1 billion tranche in March.
Pakistan is set to receive a $20 billion loan from the World Bank over the next decade under the Country Partnership Framework 2025-35, according to sources. This funding aims to enhance sustainable economic development across key sectors.
The loan programme, pending approval on January 14, aligns with the government’s National Economic Transformation Plan, which targets ambitious economic goals, including doubling GDP growth and halving poverty over five years.
On the inflation front, short-term inflation, as measured by the Sensitive Price Indicator (SPI), showed a marginal weekly decline of 0.26% for the week ending January 2, 2025, while year-on-year inflation for the same week recorded a 3.97% increase.
Meanwhile, textile exports during the first half of FY25 rose by 10% year-on-year to $9.9 billion, reflecting resilience in one of the country’s key sectors.
The PSX’s KSE-100 Index demonstrated positive momentum on Friday, reaching an intraday high of 117,891.62 before closing at 117,586.98, up 467.33 points or 0.4% from the previous session’s close.
