Bulls celebrated the new year on the Pakistan Stock Exchange (PSX) with a fresh rally of 1,800 points on Wednesday, surpassing the 117,000 barrier.
The KSE-100 index rose 1,544.18, or 1.34 percent, to settle at 116,681.01 points from the previous close of 115,126.90 at 11:53 am.
Finally, the index closed at an all-time high of 117,008.08, an increase of 1,881.18 or 1.63 percent. since the last closure.
Awais Ashraf, head of research at AKD Securities, said: “The expectation that interest rates will fall to single digits, with December inflation forecast at 4.15 per cent, the lowest since April 2018, is attracting greater investor interest.
“This optimism has particularly boosted leveraged stocks, which have seen the biggest rally,” he said.
In particular, he highlighted that Fauji Fertilizer Company had accounted for a quarter of the index’s gains “driven by the anticipation of a significant dividend following the merger of its subsidiary, Fauji Fertilizer Bin Qasim.”
“Meanwhile, banks are doing well thanks to the elimination of ADRs. [advance to deposit ratio]”The related taxes are expected to allow them to focus on deposit growth, offsetting the impact of incremental taxes,” he said.
Furthermore, AKD Securities noted that the annual performance of the stock market could be attributed to increasing political stability and aggressive monetary easing by the State Bank of Pakistan (SBP) amid stable currency.
“Macroeconomic stability and a substantial decline in fixed income yields, against a backdrop of falling commodity prices, have increased the attractiveness of stocks,” he said. “The decline in yields was facilitated by improved debt management by the government, supported by debt buyback initiatives and a strong dividend payment by the central bank.”
Regarding investor confidence, the report highlighted that it was further bolstered by mutual funds in the second half of the year, initially demonstrated by foreign investors and insurance companies in 1HCY24.
“On a global level, the KSE-100 index ranked as the second best performing market, only behind Argentina,” he added.
Yesterday, despite the slight decline in the last session of the year, the KSE-100 ended 2024 with an unprecedented gain of 84%, the highest annual performance in 22 years, driven by improved economic conditions and a stable political environment, according to the brokerage house Topline Research. saying.
The KSE-100’s stellar performance was driven by contributions from banks (13,847 points), fertilizers (11,169 points) and E&P (10,012 points). These sectors together accounted for 66 percent of the index’s gains, according to Arif Habib Limited.
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