Stocks gain 877 points as investors expect release of IMF tranche soon – Business

The benchmark KSE-100 index gained more than 800 points in intraday trading on Wednesday as analysts said clarity over the deal with the International Monetary Fund (IMF) had led to new purchases.

According to the website of the Pakistan Stock Exchange (PSX), the benchmark index rose by 877 points, or 2.18 percent, to close at 41,068.87 points.

The high during the day was 1,016.48 points around 1:33 PM.

Mohammad Sohail, CEO of Topline Securities, said investors bought again because of falling crude oil prices in the international market and the expectation that the Fund will soon release the loan tranche.

“Investors expect the rupee to strengthen as a result of lower imports and a reduced trade deficit… major gamblers and financial institutions are active in the market.”

His view was echoed by Ali Malik, CEO of First National Equities, who said investor confidence in the market had returned due to the IMF’s statement that Pakistan had met all the conditions for the assessment and that the board meeting at the end of August had approved the loan. would approve.

“The market had dropped to a very low volume last week because it was not known whether business with the IMF would continue. There is now clarity as to why people have started buying again.”

Malik added that market confidence had also increased due to the gradual strengthening of the rupee.

A day earlier, the IMF’s representative in Islamabad, Esther Perez Ruiz, said Pakistan had completed the final preliminary action needed for the combined seventh and eighth revision of the Fund by raising the petroleum development levy (PDL).

“The increase in PDL on July 31 meets the last prior action for the combined seventh and eighth grades. The [Executive Board] The meeting is tentatively scheduled for the end of August, once sufficient funding guarantees have been confirmed,” she said in a statement.

Pakistan and the IMF signed the $6 billion bailout deal — Extended Fund Facility — in 2019, but the release of the combined seventh and eighth tranche has been suspended since earlier this year, when the IMF expressed concerns about Pakistan’s compliance with the deal.

The last Executive Board meeting took place on February 2 of this year. On July 13, the IMF reached a staff-level agreement on the combined seventh and eighth revisions of the EFF, which must be approved by the board of directors before it is disbursed.

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