Pakistan Stock Exchange breaches 72,000 barrier, closes on record high again

Brokers monitor an index board showing latest share prices at the Pakistan Stock Exchange in Karachi on January 26, 2023. (AFP/File)
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Updated 24 April 2024
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Pakistan Stock Exchange breaches 72,000 barrier, closes on record high again

  • Pakistan’s benchmark index closes at a record high of 72,046 points, up by 1 percent, stock market data shows
  • The Pakistani bourse has recently been trading at record highs due to hopes of positive loan talks with the IMF

ISLAMABAD: Pakistan’s benchmark share index breached the 72,000 barrier to close at a record high of 72,051.89 points, up 1 percent on Wednesday, data from the Pakistan Stock Exchange (PSX) showed.

The Pakistani bourse has recently been trading at record highs amid positive sentiment prevailing among investors due to hopes of the country’s successful talks with the International Monetary Fund (IMF) for a new loan program.

The country’s finance minister, Muhammad Aurangzeb, recently visited Washington to hold talks with IMF officials for a long-term bailout facility as Pakistan’s current $3 billion program is due to expire this month.

The finance minister expressed hopes the outline of the new program would soon become visible, adding that the loan would help Pakistan continue with structural economic reforms.

“This surge, propelled by positive shifts in market sentiment in the backdrop of anticipation in economic metrics such as foreign exchange reserves and inflation trends, has ignited expectations of forthcoming monetary easing,” Topline Securities, a Karachi-based brokerage company, said on social media platform X. 

Topline Securities said the trading activity remained robust throughout the day, with approximately 599.29 million shares totaling Rs24.45 billion in value exchanged. 

Pakistan’s benchmark KSE100 index has surged 75.5 percent over the past year and is up 11.5 percent year-to-date.

The equity market is expected to surge further as an IMF delegation arrives in Pakistan next month to determine the contours of the new loan facility.

“We are still hoping that we can get into a staff-level agreement [with the IMF] by the time June is done or early July so that we can move on,” the finance minister said on Tuesday while addressing a news conference in Islamabad.


Lebanon’s reforms insufficient for recovery, IMF says 

Updated 4 sec ago
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Lebanon’s reforms insufficient for recovery, IMF says 

Lebanon’s economic reforms are insufficient to help lift the country out of its economic crisis, the International Monetary Fund said on Thursday. 

Ernesto Ramirez Rigo, the head of the IMF mission visiting Lebanon, said in a statement that Lebanon’s ongoing refugee crisis, fighting with Israel at its Southern border and the spillover from the war in Gaza are exacerbating an already dire economic situation. 

Israeli forces and Lebanon’s Hezbollah have traded fire across Lebanon’s southern border since the war in Gaza broke out in October last year. 

Israel launched its assault on Gaza following a Hamas-led attack on southern Israeli communities on Oct. 7 in which fighters killed 1,200 people and captured more than 250 hostages. 

Since then, Israel’s assault has killed more than 35,000 people, with thousands more feared buried under the rubble, according to Gaza health authorities. 

The conflict “has internally displaced a significant number of people and caused damage to infrastructure, agriculture, and trade in southern Lebanon. Together with a decline in tourism, the high risks associated with the conflict create significant uncertainty to the economic outlook,” Rigo said. 

Fiscal and monetary reforms carried out by Lebanon’s finance ministry and the central bank, including steps to unify multiple exchange rates for the Lebanese pound and contain a currency slump, have helped reduce inflationary pressure, according to Rigo. 

However, he said more needs to be done if Lebanon is to alleviate its financial crisis. 

“These policy measures fall short of what is needed to enable a recovery from the crisis. Bank deposits remain frozen, and the banking sector is unable to provide credit to the economy, as the government and parliament have been unable to find a solution to the banking crisis,” he added. 

“Addressing the banks’ losses while protecting depositors to the maximum extent possible and limiting recourse to scarce public resources in a credible and financially viable manner is indispensable to lay the foundation for economic recovery.” 

Since Lebanon’s economy began to unravel in 2019, its currency has lost around 95 percent of its value, banks have locked most depositors out of their savings and more than 80 percent of the population has sunk below the poverty line. 

The crisis erupted after decades of profligate spending and corruption among the ruling elite, some of whom led banks that lent heavily to the state. 

The government estimates losses in the financial system total more than $70 billion, the majority of which were accrued at the central bank. 


 


Oil Updates – prices fall for fourth straight day as US rate hike prospects emerge

Updated 26 sec ago
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Oil Updates – prices fall for fourth straight day as US rate hike prospects emerge

LONDON: Oil prices eased for a fourth straight session on Thursday after the minutes of a US Federal Reserve meeting revealed discussions of a further tightening of interest rates if inflation remained sticky, a move that could hurt oil demand, according to Reuters.

Brent crude futures fell 20 cents, or 0.2 percent, to $81.70 a barrel at 9:51 a.m. Saudi time. US West Texas Intermediate crude futures were down 29 cents, or 0.4 percent, at $77.28. Both benchmarks fell more than 1 percent on Wednesday.

Minutes released on Wednesday from the Federal Reserve’s last policy meeting showed the US central bank’s response to sticky inflation would “involve maintaining” its policy rate for now but also reflected discussion of possible further hikes.

“Various participants mentioned a willingness to tighten policy further should risks to inflation materialize in a way that such an action became appropriate,” minutes of the Fed’s meeting said.

Higher interest rates boost borrowing costs, crunching funds that could boost economic growth and oil demand in the world’s largest oil consuming nation.

Also weighing on the market, US crude stocks rose by 1.8 million barrels last week, according to the Energy Information Administration, compared with an estimate for a 2.5 million-barrel draw.

Globally, physical crude markets have more recently been pressured by soft refinery demand and ample supply.

“Recent market softness has come on the back of weaker data, including rising oil inventories, tepid demand, and refinery margin weakness and the increasing risk of run cuts,” Citi analysts said in a note on Thursday.

Russia said it exceeded its OPEC+ production quota in April for “technical reasons” and will soon present to the Organization of the Petroleum Exporting Countries Secretariat its plan to compensate for the error, the Russian Energy Ministry said late on Wednesday.

Citi said it still expects that OPEC+, which groups together OPEC and allies led by Russia, will hold its production cuts through the third quarter of this year when it meets on June 1.

Citi also said it continues to see Brent averaging $86 a barrel in the second quarter of 2024. 


Saudi EXIM Bank signs 2 agreements with Japan’s SMBC and MUFG banks

Updated 7 min 39 sec ago
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Saudi EXIM Bank signs 2 agreements with Japan’s SMBC and MUFG banks

TOKYO: On the sidelines of the Saudi-Japan Vision 2030 Business Forum in Tokyo, Saudi EXIM Bank signed two cooperation agreements with SMBC Business Banking and MUFG Bank.

The agreements aimed to foster cooperation and create co-financing opportunities to promote non-oil exports in target markets, according to the Saudi EXIM Bank.

The two agreements were signed separately by Saad bin Abdulaziz Al-Khalab, CEO of Saudi EXIM Bank, along with Akihiro Fukudom, CEO of SMBC Bank and Hironori Kamezawa, CEO of MUFG Bank, a statement confirmed.

Commenting on the partnerships, Al-Khalab stated: “This collaboration with Japanese entities is part of our joint efforts to strengthen economic relations between both countries and achieve the Saudi-Japan Vision 2030. The acceleration of commercial projects between our nations toward broader horizons comes as a result of the strength, advanced economic status, and promising investment opportunities.”

During the roundtable meeting, which brought together several ministers from both sides, Al-Khalab reviewed Saudi EXIM Bank’s activities with Japanese financial institutions and commercial companies to enhance economic and trade relations and identify projects of mutual interest.

During the financial sector’s roundtable meeting, Al-Khalab emphasized the critical importance of collaborative efforts between all financial institutions and business sectors. This is to ensure the provision of comprehensive, incentivizing credit solutions that can accelerate the pace of trade and mutual and global investment activities.

The Saudi EXIM Bank aims to empower the Kingdom’s non-oil national economy in accordance with Vision 2030. The bank is focused on enabling Saudi non-oil exports to expand and penetrate global markets by bridging financing gaps and reducing export risks.


Saudi Arabia’s non-oil exports surge by 3.3% in Q1: GASTAT 

Updated 32 min 52 sec ago
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Saudi Arabia’s non-oil exports surge by 3.3% in Q1: GASTAT 

RIYADH: Saudi Arabia’s non-oil exports, including re-exports, increased by 3.3 percent in the first quarter of this year compared to the same period in 2023, official data showed. 

According to the latest report released by the General Authority for Statistics, the value of re-exported goods increased by 31.5 percent during the same period, while national non-oil exports, excluding re-exports, decreased by 5.2 percent. 

 


Pakistan to enhance production of indigenous petroleum products— minister

Updated 22 May 2024
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Pakistan to enhance production of indigenous petroleum products— minister

  • Cash-starved Pakistan spends over $20 billion each year on petroleum imports to meet energy demand
  • Pakistan welcomes foreign companies to invest in its oil and gas sector, says Petroleum Minister Musadik Malik

KARACHI: Pakistan wants to enhance the production of its indigenous petroleum products, Petroleum Minister Musadik Malik said on Wednesday, citing the financial burden that expensive crude oil imports have on the country’s fragile economy. 

Cash-strapped Pakistan relies heavily on imported petroleum products as its energy demands grow. Struggling with a balance of payments crisis, high inflation and steep currency devaluation, Pakistan is looking to secure cheaper energy imports and find alternate ways to lessen the cost of power generation. 

According to the Trade Development Authority of Pakistan (TDAP), the country’s indigenous oil production meets only about one-fifth of Pakistan’s current oil needs. The rest is met through high-cost imports.

Prime Minister Shehbaz Sharif has urged the government to turn toward renewable energy resources. Last month, he said the country currently imports oil worth $27 billion to meet its power and transportation needs, which puts a strain on the cash-strapped nation. 

Speaking at the Pakistan Energy Symposium, Malik said it would be difficult to manage the country with such a huge energy import bill when Pakistan’s exports were around $30 billion. 

“We want to first of all, produce as much of the petroleum products, including gas and crude, indigenously as much as possible,” the minister said, adding that the government has put blocks for bidding and is actively trying to attract global players in exploration activities.

Malik said the government is expediting oil and gas exploration within the country, adding that it welcomes foreign companies to invest in the sector.

“So, we are telling the world that Pakistan is open for business, our regulatory process, particularly the petroleum concession process is very dense and opaque,” he said. 

He said investment processes and information about oil and gas exploration have been digitized and simplified to facilitate the government’s aims to enhance indigenous production of energy resources. 

Malik advocated for increasing the utilization of Pakistan’s abundant renewable energy resources, pointing out that the country’s solar energy costs have significantly decreased.