KARACHI: Pakistani stocks closed higher on Monday after the inflation rate hit a 33-month low, boosting the confidence of investors, traders said.
The Karachi Stock Exchange (KSE) benchmark 100-share index ended 0.80 per cent, or 123.91 points, higher at 15,568.73 – a four-year high – on total volume of 135.80 million shares.
“Investors are hopeful that because inflation came down sharply, there is a high probability that the state bank will reduce the interest rate,” said Mohammad Sohail, chief executive at Topline Securities.
The central bank is expected to announce a monetary policy decision on October 5.
Pakistan’s consumer price index (CPI) rose 8.79 per cent in September from a year earlier, the Pakistan Bureau of Statistics said on Monday.
The year-on-year rate in August was 9.1 per cent. On a month-on-month basis, the CPI increased by 0.79 per cent from August, according to the bureau.
In the currency market, the Pakistani rupee ended weaker at 94.88/94.94 to the dollar compared to Friday’s close of 94.75/94.80.
Overnight rates in the money market ended at 7.50 compared to 10.40 per cent on Friday.
Re: Pakistani stocks close at four-year high as inflation hits 33-month low
The markets are cyclical. Even if this is a sustained high, it won't be for long because of the politics. Markets aren't machines. If people feel unsafe and threatened, they will make irrational decisions which are not financially sound.
And what about crime? Lack of law and order? Property rights? The dire need to update the energy infrastructure? Without any of that, any growth or highs we see are aberrations and will not be sustained. You need to provide a healthy ecosystem for businesses to grow.
Re: Pakistani stocks close at four-year high as inflation hits 33-month low
The markets are cyclical. Even if this is a sustained high, it won't be for long because of the politics. Markets aren't machines. If people feel unsafe and threatened, they will make irrational decisions which are not financially sound.
And what about crime? Lack of law and order? Property rights? The dire need to update the energy infrastructure? Without any of that, any growth or highs we see are aberrations and will not be sustained. You need to provide a healthy ecosystem for businesses to grow.
True, and Rome wasn't build in a day, but credit should be given when its due.
Re: Pakistani stocks close at four-year high as inflation hits 33-month low
I think that's net positive...unless you think otherwise?
I think we should celebrate if its a sustained thing, an arbitrary high or low doesnt mean any thing. The same article is mentioning the weak rupee and high CPI.
Re: Pakistani stocks close at four-year high as inflation hits 33-month low
4 years high mean that we have only recovered to post 2008-crash state, which is not a great achievement given the massive inflation in last 4 years. It is only natural in any country to investors to move to stocks when they expect the interest rates to fall and they don't get substantial return on fixed income securities.
Also, inflation is 'easing' only, primarily triggered by easing inflation in China which in July also hit a 30 month low. The key indicators for success of any economic policy are real per capita GDP growth, foreign direct investment and employment rates. Inflation and stock indices on their own do not tell much. Reduction in growth actually has a direct impact of reducing inflation.
The question is, did income of middle class workers grow in line with inflation?
Re: Pakistani stocks close at four-year high as inflation hits 33-month low
Excuses if any thread positively highlight present government’s performance. One of your lover of super permanent lotay opened thread on increase in taxes on foreign calls, naming the thread as gift of PPP and Zardari, you did not see it as business stupid retard thread. But yes this one is. I don’t understand what kind of logic are you following here?
Re: Pakistani stocks close at four-year high as inflation hits 33-month low
True, and Rome wasn't build in a day, but credit should be given when its due.
Pakistanis have seen to many false dawns to start gushing over this accomplishment.
Considering how cynical most Pakistanis have become, it will have to be something monumental before anyone in Pak will ever pat themselves on the back. Short of that, if tomorrow we learn that the Pakistani govt has managed to land a man on Mars and planted a Pak flag there, people will still say, who cares! Lets see how long the flag manages to stand and how long they manage to survive on the surface; and by the way, where did they embezzle the money to finance this? And if its American money, then all the credit should go to them shouldnt it?!?!?
Re: Pakistani stocks close at four-year high as inflation hits 33-month low
4 years high mean that we have only recovered to post 2008-crash state, which is not a great achievement given the massive inflation in last 4 years. It is only natural in any country to investors to move to stocks when they expect the interest rates to fall and they don't get substantial return on fixed income securities.
Also, inflation is 'easing' only, primarily triggered by easing inflation in China which in July also hit a 30 month low. The key indicators for success of any economic policy are real per capita GDP growth, foreign direct investment and employment rates. Inflation and stock indices on their own do not tell much. Reduction in growth actually has a direct impact of reducing inflation.
The question is, did income of middle class workers grow in line with inflation?
I know this news for you is like swallowing load of stones and bricks.
Re: Pakistani stocks close at four-year high as inflation hits 33-month low
^^^ Haan patha hai, but this has to do with politics. See my comments on the top. ;)
Everything aside, has the 33 month low in inflation done anything for the common man? Have they seen any lowering of prices? People on the street dont care about stocks or inflation statistics, they care only about their stomachs...
All i have heard from most Pakistanis, the best barometer for the state of the economy if you ask me, is that everything is much more expensive and living standards have plummeted over the last 3-4 years to unprecedented lows.
****ISLAMABAD: In a major policy decision towards broader deregulation, the government reduced on Sunday prices of all transport fuels by up to 5.5 per cent for a week to pass on the impact of falling international prices to consumers.
The highest reduction of Rs6 (5.5 per cent) was made in the price of petrol — from Rs108.45 per litre to Rs102.45.
Re: Pakistani stocks close at four-year high as inflation hits 33-month low
You posting one postive does not make Pakistan an investors paradise. One thing you fail to realise is that inflation needs to be kept low/stable that's when long term growth can take place. It's quite easy for governments to manipulate fiscal/monetary policy for their gain especially when its elections soon.
How about the tragic energy sector? Do you even know what the real rate of growth for Pakistan is? It takes a country 35 years to double its output in GDP terms at a rate of 2% growth.
Re: Pakistani stocks close at four-year high as inflation hits 33-month low
Excuses if any thread positively highlight present government's performance. One of your lover of super permanent lotay opened thread on increase in taxes on foreign calls, naming the thread as gift of PPP and Zardari, you did not see it as business stupid retard thread. But yes this one is. I don't understand what kind of logic are you following here?
Don't be so cheap mate, i never attacked you personally so you better stay within your limits.
As for my thread, go and read the significance of the tax imposed on the calls to understand what it means for average overseas Pakistani.
What it means is that if i continue to make same amount of calls, i will be paying $600 per month as opposed to $100 per month i am paying now and you don't think i should have problem with that? That's almost 600% increase, our govt is directly impacting our lives even when we are sitting 1000s of kms away.
As for this topic, it is EXCELLENT news if we are really doing this well but i will post link shortly to a program i watched last night "Islamabad Tonight" which will give you headache if you are really a Pakistani based on figures released by current government (not just some random politician throwing accusations), you can decide after that where we are really heading.
Re: Pakistani stocks close at four-year high as inflation hits 33-month low
What is the P/E ratio for the market? Based on both trailing 12 months and based on 10-yr average? What is the growth in year over year earnings for last 5 years, last 10 years?
Sorry - had to do some harmless trolling on this topic. Carry on!
