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Bulls Continue Momentum at Pakistan Stock Exchange as KSE-100 Index Gains 1,000 Points
Bulls dominated the Pakistan Stock Exchange, pushing the KSE-100 index up by nearly 1,000 points. Experts point to falling bond yields, a Fed rate cut, and positive macroeconomic indicators for the surge.
ND
by News Desk
2024-09-19
Bulls Continue Momentum at Pakistan Stock Exchange as KSE-100 Index Gains 1,000 Points

The Pakistan Stock Exchange (PSX) continued its bullish streak on Thursday, with the benchmark KSE-100 index gaining nearly 1,000 points during the trading session. By the end of the day, the index closed at 81,459.28, marking a 997.95 point increase (1.24%) from the previous close of 80,461.33 points.

At its peak, the KSE-100 surged 1,440.81 points, hitting 81,902.14 points around 11:13 am. This strong performance marks a continuation of the market’s recent upward trajectory.

Key Drivers:

  • FTSE Rebalancing: Mohammed Sohail, CEO of Topline Securities, pointed to slower-than-expected selling linked to FTSE rebalancing, which motivated local investors to accumulate shares. He also noted that falling bond yields contributed to a shift in focus towards equities.
  • Federal Reserve Rate Cut: The US Federal Reserve’s decision to cut interest rates by half a percentage point on Wednesday provided a boost to Asian equities, including Pakistan’s market. Analysts believe this move has created optimism for local interest rates to follow suit.
  • Current Account Surplus: Sana Tawfik, head of research at Arif Habib Limited, highlighted Pakistan’s current account recording a surplus after four months, which further contributed to the bullish momentum.
  • IMF Deal Hopes: Market sentiment was also bolstered by hopes of an upcoming IMF board meeting scheduled for September 25, which could approve a crucial $7 billion loan facility for Pakistan.

Additional Insights:

Yousuf M Farooq, director of research at Chase Securities, emphasized the positive role of the Fed rate cut, while also noting expectations of a local rate reduction. He pointed out that inflation in September is expected to fall below 8%, further boosting investor confidence.

Shahab Farooq, director of research at Next Capital Limited, echoed similar sentiments, adding that improving economic indicators, including the rejection of bids in recent T-bill and FRB auctions, have contributed to the market’s rally.

The index had previously gained over 900 points in Wednesday’s session, driven by optimism surrounding the country’s improving economic outlook and news of the upcoming IMF decision.

Future Outlook:

With inflation expected to decrease and macroeconomic indicators looking positive, analysts are optimistic about continued growth in the stock market. As the IMF board meeting approaches, further developments in Pakistan’s financial stability could propel the market to new highs.
Tagged:

IMF

PSX

stocks

PakistanEconomy

KSE100
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