PTBP Web Desk
The Pakistan Stock Exchange (PSX) experienced a strong bullish trend on Tuesday, with the benchmark KSE-100 Index breaking past the 111,000-point mark. During intra-day trading, the index surged by over 1,600 points, reflecting heightened investor confidence and optimism about the market’s future prospects.
As of 11 am, the KSE-100 Index stood at 111,575.85, marking an increase of 1,605.47 points, or 1.46%. The rally was supported by significant buying activity across multiple key sectors, including power generation, refinery, oil and gas exploration companies, oil marketing companies (OMCs), fertilizer, automobile assemblers, and cement. Among the prominent gainers were heavyweights such as Honda Atlas Cars Pakistan Limited (HCAR), MCB Bank Limited (MCB), Meezan Bank Limited (MEBL), Mari Petroleum Company Limited (MARI), Oil and Gas Development Company Limited (OGDC), Pakistan Petroleum Limited (PPL), and Shell Pakistan Limited (SHEL).
Market experts attribute the ongoing bullish momentum to improving macroeconomic indicators. A key factor bolstering investor sentiment is the high inflow of overseas workers’ remittances. According to the latest data from the State Bank of Pakistan (SBP), remittances amounted to $2.92 billion in November 2024. While this figure is 4.5% lower than the $3.05 billion recorded in October 2024, it represents a significant year-on-year increase of 29.1% compared to $2.26 billion in November 2023.
During the first five months of FY25 (5MFY25), remittances reached $14.8 billion, reflecting a 33.6% increase compared to $11.1 billion during the same period in FY24. The consistent inflow of remittances has provided much-needed support to the country’s foreign exchange reserves, enhancing market confidence.
Another factor fueling the rally is the optimism surrounding potential interest rate cuts. This optimism stems from the recent decline in the inflation rate, which dropped to 4.9% in November 2024. The prospect of lower interest rates has created a favorable environment for investors, encouraging more activity in the stock market.
The positive momentum at PSX was reflected across various sectors. Power generation companies and refineries saw increased buying, while oil and gas exploration firms and OMCs also posted significant gains. The fertilizer sector, which has long been a cornerstone of Pakistan’s economy, witnessed strong interest, further contributing to the index’s upward trajectory. Additionally, the automobile and cement sectors continued to attract investor attention, highlighting the broad-based nature of the rally.
The bullish sentiment at PSX coincided with positive developments in global markets. On Tuesday, China and Hong Kong stocks surged following announcements by top policymakers about plans to ramp up policy stimulus to boost economic growth. The blue-chip CSI300 index opened with a 3.2% gain, while the Shanghai Composite index added 2.6%. Hong Kong’s Hang Seng index also experienced a robust start, jumping 3.2% and building on Monday’s 2.8% rise.
Tech stocks were among the biggest winners globally, with the tech index rising by 4.2%. The upbeat performance in Chinese markets came after the Politburo, the top decision-making body of the Communist Party, pledged to adopt an “appropriately loose” monetary policy in 2025. This marks the first easing of monetary policy in 14 years and is expected to be complemented by a more proactive fiscal policy aimed at spurring economic growth.
The bullish momentum observed on Tuesday followed a strong session on Monday, where the KSE-100 Index closed at its highest-ever level of 109,970.38. This represented an increase of 916.43 points, or 0.84%, setting the stage for Tuesday’s impressive gains.
Looking ahead, market analysts anticipate that the PSX could continue its upward trajectory, supported by favorable economic indicators and investor optimism. The potential for further interest rate cuts, coupled with strong remittance inflows and declining inflation, provides a solid foundation for sustained growth in the stock market. Additionally, the global economic environment, particularly the positive developments in Chinese markets, is likely to influence investor sentiment positively.
