Stock market, rupee respond positively as govt ends petroleum subsidies

KARACHI – Pakistani stocks jumped more than 2% shortly after opening on Friday, reacting positively to an overnight decision by the government to end petroleum subsidies.

The US dollar on Friday plummeted by Rs3 against the Pakistani currency, sliding down to Rs199 in the interbank market.

The subsidy removal meant the government imposed a major hike in petroleum prices.

IMF and Islamabad had reached a deal to release over $900 million in funds, once Pakistan removed the fuel subsidies and hiked prices, according to a Pakistani source directly involved in talks in Qatar that concluded on Wednesday.

Meanwhile, the Pakistan Stock Exchange's (PSX) benchmark KSE-100 index rose nearly 900 points and crossed the 43,000-barrier during the intraday trade. The market opened at 42,541.71.

Yesterday, Shehbaz Sharif-led coalition government finally took a hard step to hike the petroleum prices by Rs30 per litre, Finance Minister Miftah Ismail announced late Thursday.

Following the massive increase, the price of petrol will be at Rs179.86, diesel at Rs174.15, kerosene oil at Rs155.56 and light diesel at Rs148.31.