PTBP Web Desk
Exchange (PSX) has achieved a historic milestone as the benchmark KSE-100 index crossed the 99,000 mark for the first time during intra-day trading on Friday.
At around 12 PM, the index was recorded at 98,972.43, marking an increase of 1,644.04 points or 1.69%. The peak during the day reached an unprecedented high of 99,623.03, reflecting robust market confidence.
The market experienced across-the-board buying in pivotal sectors such as automobile assemblers, commercial banks, fertilizer companies, and notably in the oil and gas sector with companies like Pakistan State Oil (PSO), Pakistan Petroleum Limited (PPL), and Oil & Gas Development Company Limited (OGDC) leading the gains. This sectoral surge underscores the broad-based optimism pervading the market.
The bullish trend is supported by several positive macroeconomic indicators:
Decreasing Inflation: Market analysts, including Sana Tawfik from Arif Habib Limited, predict an inflation rate for November around 4.5-5%, which is expected to lead to further reductions in key policy rates.
Interest Rate Cuts: Recent cuts in interest rates have improved investor sentiment, encouraging a shift of liquidity from fixed income to equities, as noted by Tawfik.
Institutional Buying: Strong institutional support has been a significant factor in pushing the market indices higher.
Despite potential geopolitical tensions and planned protests by the Pakistan Tehreek-e-Insaf (PTI), the market sentiment remains overwhelmingly positive. Intermarket Securities Limited suggests that the market is not anticipating significant disruptions from these protests, predicting that the KSE-100 will soon breach the 100,000 mark.
Globally, Asian markets showed gains, buoyed by a positive close on Wall Street. The tech sector’s performance, particularly Nvidia’s earnings, initially caused some volatility but ended on an optimistic note due to assurances regarding future production lines. This global positivity has also contributed to the local market’s confidence.
With these developments, the Pakistan stock market has emerged as the second best-performing market worldwide, reflecting not just local economic health but also investor confidence in Pakistan’s economic recovery and growth trajectory.
The optimism is further fueled by expectations around government actions like resolving circular debt issues in the energy sector, which could stabilize and even enhance sector performance. Moreover, the anticipation of government packages or reforms to boost economic activity is also a contributing factor.
While the market continues to grow, it’s not without its external pressures. Rising geopolitical tensions, especially in regions like Ukraine, have influenced global oil prices, which in turn affect local market dynamics. However, the market has shown resilience, focusing more on domestic economic indicators and policy directions.
