Shares at the Pakistan Stock Exchange (PSX) crossed yet another all-time high of 94,000 on Thursday as bulls regained control of the trading floor, with analysts attributing the record to strengthening macroeconomic stability.
After snapping its record-breaking streak on Tuesday, the PSX bounced back a day ago, recovering only 131 points as investors indulged in value-hunting.
The benchmark KSE-100 increased by 548.58 points, or 0.59 per cent at around 11am, to stand at 93,904.00 from the previous close of 93,355.42. Finally, the index closed at 94,191.89, up by 836.47 points or 0.90pc, from yesterday’s close.
Yousuf M. Farooq, director of research at Chase Securities, noted, “As returns decline in fixed-income mutual funds, investors are increasingly moving cash into equities.
“Macro indicators appear stable, though some tax adjustments may be necessary to meet targets,” he highlighted, adding that the overall situation was improving.
Farooq noted that circular debt accumulation had halted and bike sales were on the rise, in addition to sales of cars and fast-moving consumer goods (FMCGs). He highlighted that the property market was also “showing signs of activity, and there is a sense of urgency among buyers fearing they might miss out”.
“However, large rallies can lead to brief, sharp corrections. Investors should be mindful of what they are buying and understand their reasons for doing so,” he cautioned, “Stocks are long-term instruments and should not be bought with money that is needed in the short term.”
Awais Ashraf, director of research at AKD Securities, stated: “The appealing valuation of the KSE-100 index is attracting investors back to equities, driven by declining fixed income yields and commodity prices, along with strengthening macroeconomic stability.”
“With a controlled current account and an overall improved fiscal outlook, as previously anticipated in the board’s review, we are now in a stronger position to secure more flexible terms with IMF,” he commented.
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