The capital market saw a strong recovery on Friday, rebounding from the previous day’s historic losses as investors took advantage of attractive valuations and positive economic indicators.
Investor sentiment was buoyed by renewed optimism, leading to a surge in buying activity across key sectors. The rebound reflected growing confidence in the market’s potential for sustained long-term growth despite recent volatility.
The Pakistan Stock Exchange’s (PSX) benchmark KSE-100 Index rose by 2,996.39 points, or 2.82%, reaching an intraday high of 109,271.36, as investors returned to the market after a week marked by sharp declines and profit-taking.
“After the recent profit-taking, valuations have become attractive, driving the market’s recovery,” said Samiullah Tariq, Head of Research at Pak-Kuwait Investment Company. He noted that improved sentiment and compelling entry points had sparked renewed investor interest.
Recent data from the State Bank of Pakistan (SBP) showed a 112% year-on-year increase in profit and dividend repatriations by multinational companies, totaling $1.128 billion in the first five months of FY2025.
The government also introduced The Tax Laws (Amendment) Bill, 2024, imposing strict measures against non-filers, including restrictions on major financial transactions and property purchases. These measures raised concerns about reduced liquidity, contributing to investor caution.
Despite market fluctuations, Pakistan’s macroeconomic fundamentals are strengthening. The country recorded a $729 million current account surplus in November, the largest since February 2015, while foreign direct investment (FDI) rose 31% year-on-year to $1.124 billion.
Friday’s session followed Thursday’s historic sell-off, where the KSE-100 Index fell by 4,795.32 points (-4.32%) to close at 106,274.97, marking the steepest single-day decline in PSX history. Despite the negative sentiment, trading volumes remained high, with 1,155 million shares traded and a turnover of Rs 56.6 billion.
