Pakistan stocks fall after three days of gains

The stock market experienced a downturn on Wednesday, closing on a negative note after three consecutive days of gains.

Slight volatility was observed as the market corrected itself.

Major sectors such as oil & gas exploration companies, commercial banks, and cement were the primary laggards, collectively shedding 253 points from the index.

Moreover, the Ministry of Power announced plans to initiate and process settlements of contracts with 14 additional independent power producers. The government has reportedly saved PKR 1.4 trillion by revising agreements with power companies, leading to expectations of a reduction in power tariffs to be announced by Prime Minister.

KSE-100 index shed 0.27% or 308.46 points to close at 114,495.71 points.

Indian stock markets closed higher for the second day in a row on Wednesday, mainly due to gains in IT and energy stocks.

However, the overall rise was limited because of worries about slowing company profits and economic growth, and because investors were being cautious before the release of US inflation data.

BSE-100 index gained 0.3% or 73.95 points to close at 24,385.90 points.

DFM General Index gained 0.10% or 5.31 points to close at 5,250.86 points.

Commodities

Oil prices surged because of more US sanctions on Russia, making people worry about potential disruptions to the world's oil supply. This is happening even though the US Energy Information Administration (EIA) predicts there will be more oil than needed over the next two years.

Investors are now waiting for official inventory data from the EIA, expected later today, which is likely to show a 1-million-barrel drop in crude oil stocks for the second week in a row.

Brent crude prices gained 0.10% to $80 per barrel.

Gold prices went up on Wednesday because the US dollar weakened. Investors are waiting for the December consumer price inflation data, especially after yesterday's producer prices were lower than expected.

They are watching this data to get clues about future monetary policy changes. The forecast predicts an increase in annual inflation to 2.9% in December 2024, up from 2.7% the previous month.

International gold prices increased 0.65% reaching $2,685.96 per ounce.

Currency

US dollar eased against PKR in the inter-bank market. Pakistani currency shed 5 paisas to 278.77. In the open market USD was trading at PKR 280.50.