The Pakistan Stock Exchange’s benchmark KSE-100 index briefly crossed the 54,000 barrier on Tuesday before shedding much of its gains and closing in the red.

A little before 11am, the index gained 403.5, or 0.75 per cent, from the previous close of 53,860.36. However, at closing time, the index lost 124.63, or 0.23pc, to close at 53,735.73.

The KSE-100 index has gained more than 30pc this year, with a turnaround in fortunes coming after the IMF approved the loan programme in July to avert a sovereign debt default.

Analysts had attributed the bullish run in the KSE-100 index earlier in the day to expectations of a timely International Monetary Fund (IMF) review.

An IMF delegation had landed in Islamabad last week for the much-awaited loan review talks, setting the stage for a deep dive into forward-looking reforms under a nine-month bailout package.

Speaking to Dawn.com, Topline Securities chief executive Mohammad Sohail said: “Momentum continues as investors are hopeful of a timely IMF review.”

“With valuations so attractive, everyone wants to buy,” he added.

Meanwhile, Faran Rizvi, head of equity sales at JS Global, attributed today’s rally to recent actions “aimed at combating illicit trade” and efforts to stabilise the value of dollar.

“The ongoing adherence to IMF recommendations within the energy sector are positive signals for investors,” he said.

“These measures reflect a commitment to maintain a favorable relationship with the IMF, ensuring eligibility for future IMF disbursements and potential financial support from other external lenders,” Rizvi added.

Salman Naqvi, head of research Aba Ali Habib Securities, also said that the ongoing IMF talks were driving the benchmark index. “There is reason to believe that the next tranche will be released after which bilateral and multilateral entities will also provide Pakistan with funds.”

He highlighted that the companies’ announcement period remained good and predicted coming days to be better in terms of corporate earnings.

“The dollar has been controlled, the Pakistani rupee has appreciated. Along with that, there are talks about the interest rates coming down in the monetary policy due in December,” Naqvi further stated.

However, he cautioned that valuations were still cheap.