The Pakistan Stock Exchange (PSX) crossed the 106,000-point milestone on Thursday, gaining over 1,500 points. This rally continued, driven by positive economic indicators and falling inflation rates.
The KSE-100 index increased by 1533.30 points, or 1.46%, rising to 106,637.63 points. This was up from the previous close of 105,448.05 points at midnight.
The rally followed Pakistan’s annual inflation rate dropping to 4.9% in November. This is the lowest inflation level since 2017. It also marks a week since the PSX first crossed the 100,000-point threshold.
Another factor boosting market confidence is the country’s shrinking trade deficit. It narrowed by 19% year-over-year to $1.59 billion. This strengthened expectations of a positive current account surplus.
Awais Ashraf, the director of research at AKD Securities, explained that mutual funds played a key role. He said the 68% rise in the index this year was driven by strong buying from these funds, especially in the second half.
He also mentioned that the rally was helped by falling fixed-income yields and a stable economic environment.
As the PSX’s upward trend continued, analysts noted that investors were hopeful of further interest rate cuts. These could come in the next monetary policy meeting, which is scheduled for December 16.
Additionally, analysts pointed to signs of economic recovery. They mentioned a rise in cement sales and a boost in petroleum sales as important factors driving investor confidence.
Earlier this week, Topline Securities Ltd reported that trade in the ready market surged to Rs 57 billion ($203 million). This was the highest trade value seen in 18 years.
