Staff Reporter Karachi
After ending the last week on a negative trajec-tory, the Pakistan Stock Exchange (PSX) is likely to remain range-bound in the week start-ing today (Monday) due to significant chal-lenges haunting the market for the last many weeks.
The PSX has been trading in a range of 46,600 to 47,200 points for the last many weeks where the level of 46,600 has been pro-viding strong support amid challenges of rising import bill, Afghan situation, inflationary con-cerns, rupee-dollar parity, lack of clarity on the macro-economic front, foreign selling, and oth-ers.
Announcement of monetary policy by the State Bank of Pakistan for the next two months on Monday (today) will keep the market under pressure as different reports are circulating in the media.
Though the majority of investors are of the view that the central bank will continue with the status quo and maintain the interest rate at 7 percent, some think that it might be increased by 25bps due to rising inflationary data and massive increase in import bill.
Any increase in policy rate may affect the market negatively for at least a couple of sessions.
The decision of the British authorities to remove Pakistan from the travel red list and decreasing number of coronavirus cases in the country are positive indicators for the market; however, cancellation of a cricket series by New Zealand and leaving Pakistan abruptly due to a “security alert” may keep foreign investors at bay.
The decision of the New Zealand authori-ties also caused panic during the second session of trading on Friday last.
On the other hand, Finance Minister Shau-kat Tarin is expected to visit the United States in near future and have a meeting with the In-ternational Monetary Fund (IMF) authorities about the lender’s next review of the loan pro-gramme.
The government has paved the way to conclude talks positively and some market sources hint at rupee’s depreciation, increase in tax rates for non-filer commercial and indus-trial electricity consumers, and massive in-crease in oil prices as the steps taken by the government to ensure revival of the IMF loan programme.
