Pakistan Stock Exchange (PSX) on Tuesday maintained its bullish momentum, driven by strong investor interest in the wake of unfolding economic developments.
Analysts mentioned that investors responded positively to a 97% month-on-month drop in Pakistan's current account deficit, coupled with speculation surrounding the potential resolution of the circular debt issue. The momentum was supported by a strengthening rupee, rising international crude oil prices and a global equity rally.
The index advanced to the intra-day high of 1,002 points, before settling at 117,001, up 801 points from the previous day. According to Ahsan Mehanti of Arif Habib Corp, stocks closed bullish as investors weighed a 97% month-on-month drop in the current account deficit that stood at $12 million for February 2025 along with speculation about potential resolution to the circular debt crisis. A strong rupee, surging global crude oil prices and a bull-run in global equities played the role of catalysts in bullish close at the PSX, he added.
At the end of trading, the benchmark KSE-100 index recorded an increase of 801.50 points, or 0.69%, and settled at 117,001.09.
In its review, Topline Securities stated that bulls dominated Tuesday's trading session, propelling the benchmark index to the intra-day high of 1,002 points. It eventually settled at 117,001, up 801 points.
The positive sentiment was largely driven by encouraging economic developments, it said. According to news reports, the International Monetary Fund (IMF) has permitted Pakistan to borrow Rs1.25 trillion ($4.5 billion) from domestic banks to help manage the Rs2.4 trillion circular debt without increasing the public debt level.
Topline added that investor confidence was further lifted as the IMF shared a draft of the Memorandum of Economic and Financial Policies (MEFP) with Pakistani authorities, marking progress towards a staff-level agreement under the $7 billion Extended Fund Facility. This reinforced hopes for sustained financial support and economic stability. The index gains were primarily fuelled by Fauji Fertiliser Company, Engro Holdings, Hub Power, TRG Pakistan and Lucky Cement, which collectively added 541 points, it said. Arif Habib Limited (AHL) remarked that the KSE-100 index unlocked the 117,000-point level, with a further upside momentum.
Some 64 shares rose while 32 fell, with Fauji Fertiliser Company (+1.43%), Hub Power (+2.29%) and TRG Pakistan (+10%) contributing the most to the index gains. On the flip side, Mari Petroleum (-2.94%), UBL (-0.32%) and Fatima Fertiliser (-2.18%) were the biggest drags, it said. AHL also pointed out that the IMF had authorised Pakistan to borrow Rs1.25 trillion ($4.5 billion) from local commercial banks to reduce its circular debt.
"The indices continue to show a bullish price structure and are approaching January's all-time highs, which should be exceeded before profit-taking is considered," it concluded.
Ali Najib of Insight Securities commented that media reports about borrowing from banks to settle the circular debt fuelled a rally in the exploration & production and oil marketing companies' sectors.
It boosted stocks such as PSO, Oil and Gas Development Company, Pakistan Petroleum, Sui Northern Gas Pipelines, Sui Southern Gas Company and Mari Petroleum, which contributed 161 points to the index. Additionally, strong performances from Engro Holdings, Fauji Fertiliser Company, Hub Power and TRG Pakistan further lifted the market, adding 479 points, he said.
Overall trading volumes decreased to 449.5 million shares compared with Monday's tally of 507.5 million.
Shares of 447 companies were traded. Of these, 206 stocks closed higher, 180 fell and 61 remained unchanged. The value of shares traded during the day was Rs29.2 billion.
Pakistan International Bulk Terminal was the volume leader with trading in 59.1 million shares, gaining Rs0.48 to close at Rs10.66. It was followed by The Bank of Punjab with 36.5 million shares, gaining Rs0.15 to close at Rs11.82 and Fauji Cement with 24.99 million shares, gaining Rs0.31 to close at Rs46.38. During the day, foreign investors sold shares worth Rs158.8 million, the NCCPL reported.
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