The Pakistan Stock Exchange (PSX) reached a significant milestone by surpassing the 72,000 mark during early morning trading on Wednesday.
In the day’s trading, the KSE-100 index, a benchmark for the stock market, rose by 976.49 points, an increase of 1.37%, closing at 72,335.89 points. This was a significant rise from the previous day’s closing of 71,359.41 points.
Raza Jafferi, CEO of EFG Hermes Pakistan, in a conversation with media, credited the surge to positive changes in key economic indicators, particularly foreign exchange reserves and the path of inflation, which have led to expectations of reduced interest rates.
Jafferi highlighted that this optimism is fuelling the performance of sectors with high leverage like cement and textiles, which are major contributors to the current market rally.
Muhammad Sohail, CEO of Topline Securities, echoed this sentiment, noting that the KSE-100 index has reached another historical high. He pointed out that a decline in consumer inflation is anticipated following a record current account surplus, which is fueling investor belief in a potential decrease in interest rates in the near future.
Conversely, the market had a mixed session the previous day, with initial gains led by a surge in the cement sector, subsequently wiped out by profit-taking activities later in the day. The KSE 100-share index closed down by 74.06 points, a decrease of 0.10%.
Ahsan Mehanti, an analyst at Arif Habib, remarked that the market closed under pressure due to various factors including weak global crude oil prices, shutdown reports concerning refineries, and anticipations of a cautious monetary policy announcement by the State Bank of Pakistan ahead of upcoming IMF loan discussions. Additional factors contributing to the downturn included the withdrawal of Shanghai Electric Power’s acquisition offer for KE, uncertainties surrounding Pakistan-US relations concerning Pakistan-Iran trade agreements, and a weakening rupee.
