PSX Continues Bullish Run, KSE-100 Surpasses 110,000 Points Amid Optimistic Market Sentiment
The Pakistan Stock Exchange (PSX) extended its bullish streak into a ninth consecutive session on Monday, with the benchmark KSE-100 index gaining over 1,000 points to surpass the 110,000 mark. By 11:24 am, the index had climbed 1,044.16 points (0.96%) to reach 110,098.11, up from the previous close of 109,053.95.
This marks a period of sustained growth for the market, which has seen record single-day gains over the past two weeks. Mutual funds played a significant role in driving the index upward, resulting in a record point-wise weekly gain of 7,697 points during the previous week.
Yousuf M. Farooq, research director at Chase Securities, attributed the surge to a decline in interest rates, which have dropped from over 20.5% in June 2024 to approximately 12%. He noted that this shift has made stock valuations more appealing and spurred a transition from fixed-income investments to equities. The anticipation of an interest rate cut in the Monetary Policy Committee meeting scheduled for December 16 has further fueled market activity.
Farooq described the current market conditions as a “reversion to the mean,” predicting that the rally will normalize long-term market returns, bringing them closer to historical averages. However, he cautioned that banks were under pressure due to media reports about potential new taxes being considered by the government.
Improved macroeconomic indicators have bolstered investor confidence, with inflation dropping to 4.9%—its lowest level since 2017. Saudi Arabia’s extension of a $3 billion deposit for another year and the conversion of seven out of 37 memorandums of understanding (MoUs) into formal contracts worth $560 million have further strengthened the market’s momentum.
