PM's tariff move lifts stocks to record high
Pakistan's stock market on Thursday shot up to a record high as the prime minister's announcement of a tariff reduction of Rs7.41 per unit to revitalise the industrial sector triggered investor interest in attractive companies.
Market players also took cue from the inflation data that exhibited an increase of just 0.7% year-on-year (YoY) in the Consumer Price Index (CPI) for March. It was anticipated that the low inflation could result in further monetary easing. Earlier, at the commencement of trading after the weekend and Eid holidays, the bourse encountered selling pressure, fuelled by US President Donald Trump's reciprocal tariffs. Consequently, the KSE-100 index fell to the intra-day low of 117,508 in the very first hour.
However, the sentiment shifted after the government announced tariff reduction, driving the index steadily to the intra-day high of 119,179 before the close of trading.
Arif Habib Corp MD Ahsan Mehanti wrote that stocks closed at a record high after the PM announced reduction in industrial power tariff and the upbeat inflation data showing only 0.7% YoY rise for March, which would likely lead to further easing of monetary policy.
Worries over 29% US reciprocal tariffs on Pakistan and global equity sell-off caused some early pressure but institutional support and government's efforts to address the Rs1.5 trillion circular debt crisis drove the market to a bullish close, he added.
At the end of trading, the benchmark KSE-100 index recorded a substantial increase of 1,131.36 points, or 0.96%, and settled at 118,938.11. Topline Securities reported that the KSE-100 index reached a historic peak of 118,938, gaining 1,131 points. The market showed a robust performance, with the index climbing 1,373 points during the day.
The surge was driven by the government's decision to lower electricity tariffs, which provided relief to consumers and industries. The market's gains were primarily fuelled by strong performances from United Bank, Meezan Bank, Mari Petroleum, Lucky Cement, and Oil & Gas Development Company, which added 839 points, Topline said.
Arif Habib Limited (AHL) stated that despite the global tariff chaos, Pakistan's bull market surged to a new all-time high. The KSE-100 closed on a strong note, where 62 shares rose and 33 fell. United Bank (+8.2%), Meezan Bank (+3.66%), and Mari Petroleum (+1.18%) led the gains. In contrast, Fauji Fertiliser (-0.51%), Systems Limited (-1.2%), and Service Industries (-4.12%) were the main laggards, it said.
AHL pointed out that after a weak opening, the market saw eager buyers, encouraged by the PM's electricity price cuts and the International Monetary Fund's nod to measures being taken by Pakistan. Additionally, inflation eased to 0.69%, the lowest in over seven years, taking the index closer to the 120,000 mark. JS Global analyst Muhammad Hasan Ather said that the KSE-100 closed at a record high as investor optimism grew following the government's initiatives. The benchmark index reclaimed the crucial 118,000 and 119,000 levels.
Announcements regarding cheaper electricity and efforts to eliminate circular debt fuelled the rally, he said. Robust corporate earnings and a broader economic recovery were likely to sustain market momentum, paving the way for further growth, the analyst added.
KTrade Securities, in its market wrap, observed that the bourse made a cautious start amid the imposition of US tariffs on Pakistan. Later, the fortune was largely driven by PM Shehbaz Sharif's announcement of power tariff adjustments, which injected positivity into the market.
Additionally, the inflation rate, which stood below 1%, also contributed to the upbeat mood, it said.
Overall trading volumes increased to 422.7 million shares compared with Thursday's tally of 330 million. Shares of 452 companies were traded. Of these, 247 stocks closed higher, 154 fell and 51 remained unchanged. The value of shares traded was Rs28.2 billion.
Sui Southern Gas Company was the volume leader with trading in 53.2 million shares, gaining Rs3.09 to close at Rs39.71. It was followed by Cnergyico PK with 20.02 million shares, falling Rs0.09 to close at Rs8.17, and Pak Elektron with 15.8 million shares, losing Rs1.57 to close at Rs46.41. During the day, foreign investors sold shares worth Rs216.3 million, the NCCPL reported.
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