PSX Gains as Profit-Taking Follows Intraday High of 91,000 Points
Stocks rallied on Monday as investors bet on potential policy easing by the central bank in its November 4 meeting, with the Pakistan Stock Exchange’s (PSX) benchmark KSE-100 index surging to an intraday high of 91,054.83 points. However, late-session profit-taking saw the index close at 90,195.51 points, up by 201.55 points or 0.22%.
Market sentiment was fueled by expectations of a more accommodative monetary policy and robust corporate earnings, particularly in sectors such as automotive, cement, banking, energy, and power generation. Topline Securities noted that the session was marked by volatility, with the index fluctuating between 91,055 and a low of 89,733 points as investors capitalized on profit-taking opportunities.
A potential rate cut and strong earnings reports boosted momentum, and Pakistan’s $1.4 billion loan application to China added to positive sentiment. Major contributors to the index’s gains included Systems Limited, Colgate-Palmolive (Pakistan) Limited, Pakistan State Oil Company Limited, Pakistan Oilfields Limited, and Pakistan Petroleum Limited, collectively adding 341 points. Trading was active, with a turnover of 566 million shares worth Rs 29 billion, led by Fauji Foods Limited, which recorded a volume of 53 million shares.
According to Tahir Abbas, an analyst at Arif Habib Limited (AHL), “The market is gaining momentum due to improved macroeconomic indicators, a stable exchange rate, and heightened investor confidence following favorable government policies.” The recent easing of inflationary pressures and declining interest rates have boosted liquidity, encouraging investors to expand their positions in equities, Abbas added.
The rupee has shown stability against the US dollar in the inter-bank market, while Pakistan’s current account recorded a surplus of $119 million in September. Commenting further, Sana Tawfik, Head of Research at AHL, pointed to the ongoing results season and improved liquidity as primary drivers of the market rally.
At the 2024 IMF-World Bank Annual Meetings in Washington, DC, State Bank of Pakistan (SBP) Governor Jameel Ahmad projected that Pakistan’s foreign exchange reserves could reach $13 billion by the end of FY2025. Ahmad credited a strong uptick in exports and worker remittances for the improvement in the current account balance, signaling a positive economic outlook.
