Tuesday saw new records set by the Pakistan Stock Exchange (PSX) when the benchmark KSE-100 index crossed the 60,000-point threshold for the first time ever.
PSX Benchmark KSE-100 Index Crossed 60,000 Points Mark
However, the benchmark index was up 919.53 points, or 1.54%, at 11:25 a.m. It was trading at 60,730.87.
In index-heavy industries like automakers, cement, chemicals, commercial banks, oil and gas exploration firms, and OMCs, there was widespread buying.
Moreover, the benchmark index rose by 724.99 points, or 1.23%, to close at 59,811.34, a record high for the exchange on Monday.
IMF Staff Level Agreement Positive Impacts
The buying binge follows a staff-level agreement between the International Monetary Fund (IMF) and Pakistani authorities over the first evaluation of the $3 billion Stand-By Arrangement (SBA), which runs for nine months.
The administration anticipates that Pakistan would get the second tranche of the SBA in December, following clearance by the IMF executive board.
Additionally, the investment would make room for contributions from other bilateral and international partners.
“Pakistan’s KSE-100 index has gained 50% in only 5 months,” said Mohammed Sohail, CEO at Topline Securities, in a post.
“From 40k to 60k. This is the fastest 50% rise in few months after 2004.”
“Such recovery is not at all surprising” given the “unbelievable low valuation (PE 3-4),” according to Sohail.
Record but not surprising
Pakistan KSE 100 index gained 50% in only 5 months. From 40k to 60k
This is the fastest 50% rise in a few months after 2004
When you have unbelievable low valuation (PE 3-4), such recovery is not at all surprising #KSE100 #PSX #pakistan #StockMarket…
— Mohammed Sohail (@sohailkarachi) November 28, 2023
Analyst Prediction
“The ongoing positive trend at the bourse reflects the investors’ growing confidence as the equities market is a leading indicator,” Sana Tawfik of Arif Habib Limited (AHL), told.
According to Sana Tawfik, the bullish momentum is anticipated to continue following the IMF’s disbursement of cash.
“Moreover, there are talks of an interest rate cut, which will be another positive as it will improve the liquidity position,” she added.
To read our blog on “PSX makes history as KSE-100 index crossed 59,000 points,” click here.
