PSX reaches new high, crosses 73,000 milestone

Published May 10, 2024
This image shows activity on the Pakistan Stock Exchange on Friday at 4:30pm. — Screenshot via PSX data portal
This image shows activity on the Pakistan Stock Exchange on Friday at 4:30pm. — Screenshot via PSX data portal

Bulls continued their stampede at the Pakistan Stock Exchange (PSX) on Friday as shares gained 427 points to reach a new milestone of 73,000 points amid expectations of inflation falling faster than the expected rate.

The KSE-100 index gained 427.45 points, or 0.59 per cent, to stand at 73,085.5 points at the day’s close from the previous close of 72,658.05.

Mohammed Sohail, chief executive of Topline Securities, mentioned that the 73,000 bounday was crossed due to “expectations that inflation may fall at a faster than expected rate”. “Investors have been buying shares of companies that will benefit from lower interest rates,” he added.

Yousuf M. Farooq, director of research at Chase Securities, said traders were expecting inflation to clock in at close to 15pc for May and for interest rates to decline over the next [financial] year, which caused some excitement in cyclicals today.

Raza Jafri, chief executive of EFG Hermes Pakistan, also said monetary easing expectations continue to build up, with real interest rates now about +5pc and the external account exhibiting comfort.

“Hitherto underperforming leveraged sectors such as cement are seeing buying interest, from both local and foreign investors,” he highlighted.

A day ago, the stock market had snapped a three-day losing streak as selective value-hunting helped the benchmark KSE 100-share index close the session in the green territory.

Ahsan Mehanti of Arif Habib Corporation attributed the PSX’s mild recovery to the World Bank’s reaffirmation of collaborating with Pakistan in structural reforms and sustainable development.

Among other factors he highlighted were the deliberations over privatising ailing state-owned enterprises, speculations ahead of new loan talks with the IMF, and the likely visit of the Saudi crown prince to seal investment deals under the Special Invest­ment Facilitation Council.

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