The benchmark KSE-100 index of the Pakistan Stock Exchange (PSX) broke above the crucial 71,000 milestone on Monday and ended the day at a record high of 71,474 points, up 0.8%.
At 11:38 am, the KSE-100 index was up 631.86, or 0.89 percent, from its previous closing of 70,909.90 points to 71,541.76 points.
The market is gained 10.43 percent so far this year, having risen 74 percent over the previous year.
In addition, “good March quarter dividends are helping share prices which despite rallying are trading at forward looking price-earning ratio of 4,” stated Sohail Mohammed, CEO of Topline Securities, a brokerage firm based in Karachi. Pakistan hopes to reach an agreement on the terms of a new International Monetary Fund (IMF) loan in May.
According to Chase Securities’ director of research Yousuf M. Farooq, “the media reports of Saudi investment in Reko Diq, the likelihood of Pakistan securing its next IMF programme and projections indicating a sharp decline in inflation and interest rates ahead” are to blame for today’s upward momentum.
Pakistan has a positive and steady current account balance, and the country’s economy seems to be headed toward recovery. Significantly undervalued assets have been created by persistently bad economic conditions, and the recent surge might just be a return to the mean, the speaker continued.
In summary, he stated that the rise was mostly sparked by “strong corporate earnings, good payout announcements, and smooth IMF negotiations for a new program.”
The same opinions were expressed by Awais Ashraf, director of research at Akseer Research. He stated that “investor confidence has improved due to the declining trajectory of inflation and the increasing prospects of Saudi investment in Pakistan.”
Furthermore, Ashraf noted that anticipation of Saudi investment in Reko Diq and the government’s emphasis on reforms were “fueling interest in heavyweights like Oil and Gas Development Company (OGDC) and Pakistan Petroleum Limited (PPL).”
In addition, he stated, “fertilizer stocks and commercial banks are seeing positivity in anticipation of higher payouts.”
The bullish trend was attributed by Shahab Farooq, director of research at Next Capital Limited, to a “relatively stable Middle Eastern situation leading to decline in international crude oil prices,” as well as to encouraging news about a new IMF program and optimism for Saudi investments.
“The positive momentum is also being aided by the announcement of healthy results,” he stated.
