Stocks surge, triggered by surprise devaluation of rupeeBusiness
The Pakistan Stock Exchange's benchmark KSE-100 Index gained 770 points on Tuesday amidst upheaval in the currency markets as the rupee lost ground to the dollar, closing at 44,310 on Tuesday.
"The Pakistani rupee witnessed pressure in the interbank earlier today and closed at Rs114 against the dollar as compared to yesterday’s closing rate of Rs110.6," read a note from Topline Securities analyst Fahad Qasim.
"The rupee lost its value earlier than expectations as market was expecting that this weakening may take place in the caretaker government setup in June 2018," it added.
By day's close, the benchmark index was up 1.77 per cent as investors priced in the impact of a worsening exchange rate on the country's balance of payments situation.
"Consequently, investors jumped into dollar-hedged sectors in expectations of better returns in coming sessions," commented Topline Securities. "E&Ps, textile and IPPs contributed contributed 217 points to the index. Similarly, banks emerged as the top performer in the market and added 413 points to the index in anticipation of a rise in the policy rate."
"Initially, interest was seen in the financial sector on expectations of an increase in the policy rate on the back of higher inflation amidst currency depreciation," reported JS Research. "Optimism was also witnessed in the textile stock as investors took the advantage of the US dollar hitting a new high," it added.
Over the day, 374 scrips recorded activity, of which 209 advanced, 147 declined and 18 remained unchanged.
Both volumes and values were markedly higher, climbing to 220 million shares from 141m a day earlier, and to Rs10.98 billion from Rs5.36bn a day earlier.
Chemicals attracted most of the volumes, with 38m shares traded. Banks followed with 25.3m shares traded, then technology and cement stocks with 20.5m and 18.5m shares traded, respectively.
The top symbols by volume were:
Nimir Resins: +5.22pc, 15.2m shares traded
TRG Pak: +3.98pc, 13.4m shares traded
Lotte Chemical: -2.51pc, 13.2m shares traded
Unity Foods: +2.55pc, 10.5m shares traded
Aisha Steel: +3.11pc, 9.7m shares traded.