PSX hits new high as KSE-100 index crosses 102,000 points

The Pakistan Stock Exchange (PSX) achieved another historic milestone as the KSE-100 index surged to a record high of 102,664.34 points, marking an increase of 1,307.02 points, or 1.29%, during today's intra-day trading.

At 11:15am, the market witnessed a strong upward movement, reaching an intraday high of 102,737.83 points, while the low for the day was recorded at 101,921.20 points.

The trading volume reached 345,041,632 shares, with a total value of 11,381,780,782 PKR.

This surge continues the positive momentum in the market, following a series of record-breaking performances.

The PSX has been on a bullish trajectory in recent weeks, with the KSE-100 index now comfortably above the 102,000-point level.

Analysts suggest that investor confidence, coupled with favorable economic signals, is fueling this growth. The stock market's robust performance is expected to have a positive impact on the broader economy.

The Pakistan Stock Exchange (PSX) reached a historic milestone in the past week, surpassing the 100,000-point mark and closing at 101,357, reflecting a 3.6% increase.

The market initially faced pressure earlier in the week due to heightened political unrest, resulting in significant selling and a decline of 3,500 points. However, following the cancellation of protests by the Pakistan Tehreek-e-Insaf (PTI), the market experienced a strong recovery, largely driven by the banking sector’s performance after the removal of the minimum deposit rate (MDR) for conventional banks, as well as easing inflation expectations.

Despite foreign selling amounting to $15 million, local buying by institutional investors, particularly mutual funds and insurance companies, helped sustain the momentum. Positive economic indicators, such as a reduction in government bond yields by 61 to 85 basis points (bps), also contributed to the rally. The government raised Rs616 billion in a T-bills' auction against the target of Rs800 billion, further boosting market sentiment.

Moreover, there was growth in auto financing and an increase in the country’s foreign currency reserves following a $500 million loan from the Asian Development Bank (ADB).

Investor sentiment, buoyed by these developments, elevated the KSE-100 index, positioning it for continued strength in the coming week.

Market Movement:
At the start of the week, the PSX reached a new all-time high of 98,080 with a gain of 280 points, driven by strong investor interest in the banking sector and easing political tensions. However, the following day, the market saw its largest-ever single-day drop, plunging 3,506 points (3.57%) due to concerns over political instability. On Wednesday, the PSX showed remarkable resilience, surging nearly 4,700 points, marking the biggest single-day recovery in its history.

The next day, the market crossed the historic 100,000-point milestone, as analysts attributed the rally to improved investor sentiment, bolstered by declining interest rates and lower inflation, which made equities more attractive. On Friday, the market surged nearly 1,300 points, reaching a new high above 101,000, led by significant gains in the oil, banking, and pharmaceutical sectors.

The KSE-100 index closed at 101,357, reflecting an increase of 3,559 points, or 3.64% week-on-week.

JS Global analyst Abdul Basit noted that bullish momentum persisted, with the slight decline earlier in the week offset by the strong recovery following the PTI’s decision to call off protests. Average volumes fell marginally by 1% week-on-week to 979 million shares, while foreign selling amounted to $15 million, offset by strong local buying from mutual funds and insurance companies.

Basit also highlighted that developments in the banking sector, particularly the changes in MDR, kept the activity high in bank stocks throughout the week. In the recent T-bills' auction, the government raised Rs616 billion, with yields decreasing by 61-85 bps across various tenors.

Auto financing continued to recover, reaching Rs236 billion in October 2024, up 3.7% month-on-month. The latest data also showed an increase in the SBP's foreign currency reserves by $131 million to $11.4 billion, with an additional $500 million from the ADB under its climate financing programme expected to be reflected in the reserves in the coming week.

AHL Research pointed out that easing inflation and a strong rally in commercial banks were the key drivers of the PSX’s recovery. The Pakistani rupee depreciated marginally by 0.10% week-on-week, closing at Rs278.04 against the US dollar.

Sector and Stock Contribution:
Positive contributions came from commercial banks (1,676 points), technology and communication (349 points), oil and gas exploration companies (284 points), oil and gas marketing companies (260 points), and cement (234 points), as per AHL.

Notable individual stock contributors included Habib Bank Ltd (694 points), Bank AL Habib (538 points), Pakistan Petroleum (274 points), Systems Ltd (255 points), and Bank Alfalah (205 points).

AHL Research also forecasted that the market would likely sustain its positive momentum in the coming week, driven by expectations of further inflation decline, with the November inflation projection at 4.7%. The report also mentioned that certain stocks were trading at attractive valuations, continuing to draw investor interest.

Foreign selling totaled $15.1 million for the week, compared to net selling of $32.9 million in the previous week.