The Pakistan Stock Exchange (PSX) soared to a historic high on Monday as investor sentiment became bullish due to economic and corporate developments, with the benchmark KSE-100 Index closing with an increase of over 1,500 points.
Bullish momentum was observed throughout the trading session, pushing the KSE-100 to an intra-day high of 147,005.17.
At close, the benchmark index settled at 146,929.84, an increase of 1,547.05 points or 1.06%.
“Sentiment surged after reports of US firms gearing up to invest in Pakistan’s energy sector, further reinforced by better-than-expected corporate results that added to the market’s upbeat tone,” brokerage house Topline Securities said in its post-market report.
Market giants MARI, BAHL, OGDC, MEBL, and MCB dominated the rally, together pumping 959 points into the index’s advance and reaffirming the market’s risk-on mood.
Analysts attributed the positive momentum to several positive macroeconomic and corporate factors, Topline said.
“The continuity of the IMF programme” is providing policy stability and ensuring the implementation of critical fiscal and structural reforms, Saad Hanif, Head of Research at Ismail Iqbal Securities, told Business Recorder.
“This is complemented by a better external and fiscal account position.”
The market expert added that the investor sentiments are further bolstered by attractive valuations, making equities appealing compared to other asset classes, including real estate, which remains largely stagnant.
Moreover, strong corporate performance, with several listed companies reporting all-time high profits, is also adding to the momentum. “All this makes a very good ground for the ongoing rally,” he said.
During the previous week, PSX extended its winning streak with the benchmark KSE-100 Index surging by 4,348 points, or 3.1%, to close at an all-time high of 145,383.
Internationally, major share indexes crept higher in Asia on Monday as upbeat company earnings underpinned high valuations in the tech sector, while a crucial report on US inflation would likely set the course of the dollar and bonds.
Trade and geopolitics also loom large with a US tariff deadline on China due to expire on Tuesday amid expectations it will get extended again, while President Donald Trump and Russian leader Vladimir Putin are due to meet in Alaska on Friday to discuss Ukraine.
The main economic release will be US consumer prices on Tuesday, with analysts expecting the impact of tariffs to help nudge the core up 0.3% to an annual pace of 3.0% and away from the Federal Reserve target of 2%.
An upside surprise would challenge market wagers for a September rate cut, though analysts assume it would have to be a very high number, given a downward turn in payrolls is now dominating the outlook.
Markets imply around a 90% probability of a September easing, and at least one more cut by year-end.
Trump’s pick for Fed governor, Stephen Miran, may or may not be in place in time to vote for a cut in September, while the choice of a new chair has broadened out to around 10 contenders.
The prospect of lower borrowing costs has supported equities, along with a run of strong earnings.
Meanwhile, the Pakistani rupee maintained its upward momentum against the US dollar, appreciating 0.01% in the inter-bank market on Monday. At close, the currency settled at 282.45, a gain of Re0.02.
Volume on the all-share index increased to 611.21 million from 548.05 million recorded in the previous close.
The value of shares declined to Rs44.00 billion from Rs45.49 billion in the previous session.
Lotte Chemical was the volume leader with 73.28 million shares, followed by Siddiqsons Tin with 21.16 million shares, and Invest Bank with 19.98 million shares.
Shares of 479 companies were traded on Monday, of which 242 registered an increase, 209 recorded a fall, while 28 remained unchanged.
