Bullish momentum continued at the Pakistan Stock Exchange (PSX) on Monday, with shares gaining over 600 points during intraday trading.
The benchmark KSE-100 index surged by 621.85 points, or 0.64%, reaching 98,420.08 at 12:45 pm, up from the previous close of 97,798.23 points. The index eventually closed at 98,079.78, marking a gain of 281.55 points from the previous session.
Mohammed Sohail, CEO of Topline Securities, attributed the rally to “unconfirmed speculation” that the State Bank of Pakistan (SBP) may ease minimum deposit rates (MDR) for savers.
Yousuf M. Farooq, Director of Research at Chase Securities, noted that a surge in banking stocks, driven by rumors about the potential removal of the advance-to-deposit ratio (ADR) tax and adjustments to MDR, contributed to strong market performance, even as caution prevailed in other sectors.
Farooq highlighted that banks such as Bank Al Habib, Meezan Bank, Bank Alfalah, and MCB were leading the rally, driven by consistent fund inflows as both individuals and institutions shifted from fixed-income investments to equities amid declining yields.
Despite ongoing political uncertainties, Farooq remarked that the market largely overlooked political noise. He advised retail investors to focus on long-term investment strategies, emphasizing the importance of a disciplined, diversified portfolio.
Awais Ashraf, Director of Research at AKD Securities, echoed similar sentiments, noting that institutional inflows, prompted by lower fixed-income yields, helped sustain the index’s upward trend, mitigating the negative impact of political developments. He also mentioned that expectations of commercial banks being exempt from ADR taxation contributed positively to the day’s market performance.
