Pakistan Stock Exchange (PSX) reached a historic milestone on Friday as it surpassed the 83,000 mark for the first time with an increase of over 800 points, fueled by strong investor interest in blue-chip stocks and a fall in government bond yields.
Trading activity was vibrant across various sectors, including exploration and production, chemicals and real estate, where key stocks recorded notable gains.
Market sentiment was further boosted by encouraging macroeconomic indicators, particularly the increase in State Bank of Pakistan's (SBP) foreign exchange reserves to $10.7 billion – a two-and-a-half-year high.
The rise in reserves followed the recent disbursement of International Monetary Fund's (IMF) first loan tranche of $1.03 billion under a new $7 billion Extended Fund Facility for Pakistan.
Overall, the PSX saw the upward momentum for almost throughout the day, signaling growing optimism among investors and strong market fundamentals.
"Stocks closed at historic highs, led by across-the-board interest in blue-chip shares, amid speculation surrounding the earnings season and declining bank lending rates," said Ahsan Mehanti, Managing Director of Arif Habib Corp.
"Higher global crude oil prices, the dismissal of mini-budget due to improved tax collection, improving relations between Pakistan and India, projection of over $27 billion worth of SIFC projects and soaring foreign exchange reserves were the major drivers of bullish momentum at the PSX," he added.
At the close of trading, the KSE-100 index registered significant gains of 810.19 points, or 0.98%, and settled at 83,531.96.
Topline Securities, in its commentary, noted that the KSE-100 index extended gains as it rose 810 points to close at 83,532.
"It was attributed to the decline in yields in the secondary market for government treasury bills and Pakistan Investment Bonds, along with heightened investor interest in the exploration and production (E&P) sector," it said.
Among E&P companies, Pakistan Petroleum Limited (PPL) sent its detailed financials to the exchange, which highlighted improved cash collection ratio of 81% in FY24 compared to 53% in FY23, thanks to the upward revision in gas prices.
Major positive contribution to the index came from PPL, Oil and Gas Development Company, Meezan Bank, Lucky Cement and Pakistan Oilfields, which collectively added 517 points, Topline said.
Arif Habib Limited (AHL), in its report, stated that the PSX finished a strong week of gains, with the KSE-100 index rising 2.75%.
On Friday, 58 shares advanced while 35 declined. Notably, PPL saw a significant increase of 6.4%, followed by Oil and Gas Development Company at 3.68% and Meezan Bank at 2.7%, contributing substantially to the index's upward movement, it said.
"The momentum towards new all-time highs is expected to continue in the near term, with support projected between 82,000 and 83,000 for the coming week," AHL added.
JS Global analyst Mohammed Waqar Iqbal observed that the KSE-100 index posted a gain of 810 points to close at 53,532. Trading volumes reached 382 million shares, compared to 320 million in the previous session.
The session saw broad-based buying, with notable participation from investors in the E&P and fertiliser sectors throughout the day. Pace Pakistan, PPL, Kohinoor Spinning Mills, Airlink Communications and WorldCall Telecom were the volume leaders of the day.
Additionally, treasury yields dropped significantly in both the recent auctions and secondary markets, reflecting growing investor confidence.
The analyst added that textile and automotive sectors appeared attractive for investment and advised investors to avail of any dips as an opportunity to buy stocks.
Overall trading volumes increased to 381.5 million shares compared with Thursday's tally of 319.9 million. The value of shares traded during the day was Rs20.5 billion.
Shares of 444 companies were traded. Of these, 201 stocks closed higher, 167 declined and 76 remained unchanged.
Pace Pakistan was the volume leader with trading in 59.3 million shares, gaining Rs0.88 to close at Rs6.29. It was followed by Pakistan Petroleum with 21.6 million shares, gaining Rs7.14 to close at Rs118.60 and Kohinoor Spinning Mills with 19.5 million shares, gaining Rs0.08 to close at Rs8.12.
During the day, foreign investors sold shares worth Rs2.12 billion, according to the NCCPL.
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