Investors seemed to be pleased with the reduction of the current account (CA) deficit in a deal that was closely guarded, which led to an increase in stock prices on Tuesday, traders said, despite the fact that political instability continues to be a reason for worry.
In a post-market statement, Darson Research said that the country’s current account deficit dropped significantly by 47% over the first four months of this fiscal year, which contributed to the local equities market finishing on a positive note (FY23).
After reaching an intraday high of 315.26 points at 43,076.45 points, the benchmark KSE-100 Index on the Pakistan Stock Exchange (PSX) finished the day with a gain of 167.43 points to close at 42,928.62 points.
According to what the brokerage firm had to say about the matter, “this alone was the key driver for the buoyancy of the market.”
The current account deficit for Pakistan ballooned to $567 million in October 2022, up $204 million or 56% from September’s figure of $363 million, month-on-month. However, the deficit narrowed by 68% year-on-year (YoY), thanks to the central bank-led curbs that have successfully put a brake on imports.
According to information that was made public by the State Bank of Pakistan (SBP) on Monday, the current account deficit decreased by 47% year-on-year to $2.821 billion during the first four months of this fiscal year (4MFY23), as compared to $5.305 billion during the same period of the previous fiscal year.
The decrease in the current account monthly deficit was ascribed by analysts to a fall in workers’ remittances by 9% month-on-month ($221 million), which brought the total to $2.216 million.
According to Topline Research, the global benchmark indices provider, MSCI, added four firms to its Frontier Market FM100 Index during its most recent semi-annual review (Pakistan Oil Fields, TRG Pakistan, System Limited, and Lucky Cement).
According to the statement made by the brokerage, “this news contributed to the purchasing momentum which kept blue chip stocks in the forefront throughout the day.”
The index received a boost throughout the day from the favorable performance of companies in the technology, fertilizer, and auto sectors. As a direct consequence of this, System Limited, Engro Corporation, Indus Motor, Pak Elektron Ltd., and Dawood Hercules Corporation Limited contributed 152 more points to the index.
On the other hand, TRG Pakistan, Pakistan Petroleum Limited, and Oil, and Gas Development Company all participated in profit-taking, which resulted in a loss of 30 points for the group as a whole.
Today, there were over 194 million shares exchanged, which resulted in a total trading value of approximately Rs 6.8 billion. With a total volume of 18.5 million shares traded, WorldCall Telecom Limited topped the leaderboard of volume leaders.
