The benchmark index of the Pakistan Stock Exchange (PSX) continued its bullish run on Tuesday and crossed the 60,000 barrier, a record high.
At 10am, the KSE-100 index’s trade volume increased by a further 564.50 points, or 0.94 per cent, from the previous close of 59,811.34, effectively crossing the 60,000 barrier.
The benchmark KSE-100 index had sustained its rally from the previous week, which analysts had attributed to attractive valuations, corporate profits, reduced economic volatility, and the successful conclusion of a staff-level deal with the International Monetary Fund (IMF).
Moreover, experts predicted a continuing positive momentum amid expectations of “peaked out inflation and monetary easing onwards”.
Sana Tawfik, deputy head of research at brokerage and investment banking firm Arif Habib Limited, attributed the rally to IMF’s inflows expected next month and strong fundamental performances of sectors along with attractive valuations.
In addition to this, she also noted there were “expectations of interest rate reversal cycle — this makes equity market attractive hence allocations of funds shift from fixed income to equities”.
Capital market expert, Mohammad Saad Ali, identified main bull market drivers to be the disbursement of the IMF tranche, in addition to positive market outlook, strengthened by expectations of an interest rate cut in the next monetary policy meeting due in December.
He further noted that the rupee had stabilised against the dollar after depreciating against it, which sustained the rally.
Mohammed Sohail, chief executive of Topline Securities, observed that the record-high trade was not surprising.
He said, “When you have unbelievable low valuation, such recovery is not at all surprising.”
He added that the index had gained 50pc in only 5 months, making a jump from 40000 to 60000. He highlighted that “this is the fastest 50pc rise in a few months after 2004”.
More to follow
Source: dawn.com
