PSX inches closer to record high
Foreign funds would divert their liquidity into buying Pakistan's stocks. This would merely increases prices of shares and be profitable for those who already hold stocks. PHOTO: FILE
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The Pakistan Stock Exchange (PSX) followed through on the previous day's record surge with notable gains on Tuesday, buoyed by investor optimism over the easing of war fears between Pakistan and India and assurances from the finance minister about the limited fiscal fallout from the geopolitical tensions.
The KSE-100 index soared to an impressive intra-day high of 2,769 points, nearing its all-time high of 120,796, before settling with an increase of 1,278 points, or 1.09%, at 118,576.
The recent approval of $2.4 billion in loans by the International Monetary Fund (IMF) under the Extended Fund Facility (EFF) and the Resilience and Sustainability Facility (RSF) as well as a rally in crude oil prices and upbeat global equities lifted investor sentiment in the local market.
Institutional buying, especially by the local mutual funds, and strong participation across key sectors propelled the benchmark index closer to the all-time high.
Trading activity remained robust as 684 million shares were traded while the traded value came in at Rs53 billion – the highest in five months.
Ahsan Mehanti of Arif Habib Corp stated that stocks closed higher as investors weighed ceasefire talks between Pakistan and India, which resulted in stability, and the finance minister's assurance of a minimal fiscal impact from the conflict.
Rupee stability due to the easing of geopolitical tensions and the IMF loan approval, alongside upbeat global equities and a surge in crude oil prices, played the role of catalysts in bullish close at the PSX, added Mehanti.
At the end of trading, the benchmark KSE-100 index recorded an increase of 1,278.16 points, or 1.09%, and settled at 118,575.89.
In its market review, Topline Securities commented that the bullish momentum from the previous session was carried forward, fuelled by robust institutional buying, particularly from the local mutual funds. This positive sentiment propelled the benchmark index to an impressive intra-day high of 2,769 points, closing at a remarkable 118,576 with an increase of 1,278 points.
Key drivers of the rally were heavyweight stocks such as Pakistan Petroleum, Oil and Gas Development Company, Lucky Cement, Pakistan State Oil (PSO) and Mari Petroleum, which contributed 1,177 points to the KSE-100 index, added Topline.
In its commentary, Arif Habib Limited (AHL) stated that Monday's follow-through gains touched 120,000 points before coming off, but it still managed to advance 1.09% day-on-day.
Some 51 shares rose while 45 fell, with Pakistan Petroleum (+10%), Oil and Gas Development Company (+7.71%) and Lucky Cement (+3.97%) contributing the most to index gains. On the flipside, Bank AL Habib (-2.58%), MCB Bank (-2.27%) and UBL (-1.23%) were the biggest index drags, noted AHL.
It added that Lucky Core Industries had announced a 5:1 stock split. Moreover, the government was offering relief to industries and salaried individuals by reducing the super tax in the upcoming federal budget for 2025-26.
"The key level to watch for sustainability is 120,000 points, while 113-115,000 points is a zone on watch as potential support," it commented.
JS Global analyst Muhammad Hasan Ather remarked that the KSE-100 index surged 2.4% in intra-day trading, continuing its three-session rally and nearing the all-time high of 120,796.
The bullish sentiment followed signs of de-escalation in India-Pakistan tensions, which previously weighed on the market. Additionally, the IMF's financial support, including a fresh $1.4 billion under the Resilience and Sustainability Facility, boosted investor confidence, he said.
Going forward, stability in geopolitical conditions and continued structural reforms would be the key to sustaining the momentum, with traders eyeing a break above record levels, noted Ather.
Overall trading volumes decreased to 684.3 million shares compared with Monday's tally of 732.9 million. Shares of 462 companies were traded. Of these, 221 stocks closed higher, 194 fell and 47 remained unchanged.
WorldCall Telecom was the volume leader with trading in 41.7 million shares, falling Rs0.06 to close at Rs1.26. It was followed by Maple Leaf Cement with 41.1 million shares, gaining Rs6.27 to close at Rs75.92 and Sui Southern Gas Company with 35.8 million shares, gaining Rs2.33 to close at Rs32.79. During the day, foreign investors bought shares worth Rs386.8 million, the National Clearing Company reported.
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