The Pakistan Stock Exchange (PSX) experienced a surge in market sentiment as political clarity emerged regarding the formation of a new government. In the opening hour of trading on Wednesday, the benchmark KSE-100 index witnessed a remarkable increase of over 1,000 points.
At 10:30 am, the benchmark index stood at 61,351.53, reflecting a gain of 887.29 points or 1.47%. It reached an intra-day high of 61,607.87. Notably, a widespread buying trend was observed, with key stocks like OGDC, PPL, and PSO trading in positive territory.
The positive market momentum followed an agreement between two major political parties, the Pakistan Muslim League-Nawaz (PML-N) and the Pakistan Peoples Party (PPP), to form a coalition government at the center. This agreement, finalized after several rounds of consultations, came nearly two weeks after the general elections.
According to reports, the understanding was reached during a meeting of senior leaders, including PML-N president Shehbaz Sharif and PPP chairman Bilawal Bhutto Zardari. A joint press conference, attended by PPP co-chairman Asif Ali Zardari and other senior leaders, confirmed the agreement. Under this understanding, Shehbaz Sharif is slated to be the joint candidate for the prime minister, with Asif Ali Zardari as the candidate for the office of the president. The composition of the cabinet will be determined through consultations.
Bilawal Bhutto Zardari expressed confidence, stating, “We, the PPP and PML-N, have achieved the required number, and we are in a position to form the government.”
Globally, Asian stocks faced a slight downturn on Wednesday due to reduced expectations of early interest rate cuts by the Federal Reserve, impacting risk appetite. Investors awaited the minutes of the U.S. central bank’s last meeting for insights into the policy outlook.
MSCI’s Asia-Pacific shares index outside Japan was 0.09% lower, and Japan’s Nikkei eased 0.21%, while China stocks showed mixed performance. This came after China implemented the largest-ever reduction in its benchmark mortgage rate to support the struggling property market.
In contrast to the previous day’s flat closing, Tuesday’s trading session saw the PSX ending with a substantial gain, with the KSE-100 settling at 60,464.24, reflecting an increase of 4.49 points or 0.01%.
