Stocks manage modest gain in outgoing week

The stock market remained volatile due to rising political and economic uncertainty. However, based on last session’s bullish performance, it closed the outgoing week in the green zone, driven by continuous slowing Consumer Price Index-based (CPI) inflation. Arif Habib Ltd (AHL) said the week commenced positively with Monday’s Monetary Policy Committee (MPC) meeting. The State Bank of Pakistan (SBP) announced a policy rate cut of 100bps, bringing the interest rate down to 19.5 per cent. In a further boost to market sentiment, Fitch Ratings upgraded Pakistan’s credit rating from CCC to CCC+ on the back of an improved external funding outlook. Moreover, the CPI for July stood at 11.1pc, slowing to a 33-month low. However, Pakistan’s trade deficit in July increased by 19.7pc year-on-year to $1.95 billion. Meanwhile, the government raised $141bn through the auction of Pakistan Investment Bonds (PIBs), with three-year and five-year yields declining by 36bps and 15bps, respectively.