ISLAMABAD: The Pakistan Stock Exchange’s benchmark index, KSE-100, surged past the 61000 points, hitting 61,412 points on Wednesday morning. The benchmark index marked a 1.12% increase from its previous close at 60,730, continuing its impressive rally.
Analysts noted that this surge in stock prices, among the fastest in two decades, has been driven significantly by dollar inflows, particularly from overseas corporate investors. In the last five months alone, the index has soared by over 38%.
Experts highlighted foreign buying ahead of the MSCI review on November 30 as a key factor propelling today’s momentum. They also pointed out the positive impact of anticipated yield reduction in the T-bill auction, signaling potential interest rate decreases.
The stock market analysts said that the market momentum will persist, potentially receiving an additional boost when the International Monetary Fund’s executive board approves the first review of the $3 billion Stand-By Arrangement, leading to a disbursement of around $700 million on December 8.
Moreover, Tawfik emphasized the positive announcement of the quarterly GDP growth rate by the National Accounts Committee (NAC), revealing a 2.13% growth for the first quarter of July-September 2023-24. This quarter’s GDP data, supported by industry-wise methodology approved by NAC, has garnered support from both local and international institutions.
Additionally, she underlined the role of the T-bill auction as a catalyst for today’s rally, with expectations of yield reduction and anticipation of forthcoming interest rate cuts in the upcoming monetary policy.
Earlier, as was expected, the KSE-100 benchmark index of the Pakistan Stock Exchange (PSX) continued its bullish trend to break another record by crossing 60,000 points for the first time in its history.
The market gained 611 points to reach 60,423 points at 10:00 in the morning on Tuesday.
On Monday, the KSE index breached 59,811 points indicating that it will hit another record on Tuesday morning. The PSX index obtained 725 points or 1.23% to close at 59,811.34. Analysts said the equities market has been thriving since the successful first review with the International Monetary Fund (IMF), which will lead to the release of the next loan tranche.
Moreover, Finance Minister Dr Shamshad Akhtar also said she hopes the IMF tranche will serve as a catalyst for subsequent contributions from other bilateral donors of around $1.5 billion.
In addition to the IMF deal, analysts have attributed the performance of the market to fiscal discipline by the government as well as a clampdown on the smuggling and manipulation of the dollar.
Meanwhile, Caretaker Prime Minister Anwaarul Haq Kakar announced in a video message on Monday that Pakistan and the United Arab Emirates (UAE) have signed multi-billion memorandums of understanding across various sectors.
He mentioned the presence of Pakistan’s Army Chief General Asim Munir and federal ministers, alongside key ministers from the UAE during the signing ceremony.
