Pakistani stocks ended slightly higher on Monday, led by middle-tier shares such as financial group Jahangir Siddiqui (JSCO) and textile company Azgard Nine (AZNL), on hopes of strong corporate profits due to be announced soon, dealers said.
The Karachi Stock Exchange (KSE) benchmark 100-share index rose 0.18 percent, or 22.22 points, to 12,517.90 points. Turnover reached 232.85 million shares, not much different from the 233.2 million traded on Friday.
Volume leader JSCO ended 10.63 percent higher at 10.41 rupees and AZNL rose 14.88 percent to close at 7.72 rupees.
“Mid-cap stocks remained in the limelight,” said Samar Iqbal, a dealer at Topline Securities. “Almost half of the 233 million shares traded in the market were in only five stocks, which are JSCL, AZNL, FCCL (Fauji Cement), DGKC (D.G. Khan Cement) and BAFL (Bank Alfalah).”
In the currency market, the rupee ended weaker at 90.85/95 to the dollar, compared with Friday’s close of 90.77/83, because of higher import payments, especially for oil.
International oil prices rose on Monday, briefly hitting an eight-month high above $121 a barrel, as Iran halted exports to British and French companies ahead of a European Union embargo.
The rupee touched a record low of 91.28 to the dollar on Jan. 9, pressured by worries about higher payments for oil imports and the country’s overall economic health.
The rupee is likely to stay under pressure and the State Bank of Pakistan this month cautioned it would be a challenge to finance the projected current account deficit.
The central bank’s latest monetary policy announcement kept the key policy rate flat at 12 percent for the next two months.
The current account recorded a provisional deficit of $2.633 billion in the first seven months of the 2011/12 fiscal year, compared with a deficit of $96 million in the same period last year, according to data from the State Bank of Pakistan.
The deficit is likely to widen further in coming months because of debt repayments and a lack of external aid.
Dealers said they were also cautious after the International Monetary Fund (IMF) advised Pakistan to take immediate steps to tackle growing budget pressures and raise interest rates to contain inflation.
The IMF in February projected a widening of Pakistan’s budget deficit in the 2011/12 fiscal year to 7 percent of gross domestic product, compared with the government’s revised budget target of 4.7 percent.
In the money market, overnight rates ended lower at between 10.75 percent and 11.25 percent, compared with Friday’s close of 11.90 percent, after scheduled inflows of 18 billion rupees ($198.24 million).
