Pakistan’s Pakistan Stock Exchange (PSX) reached an unprecedented peak as KSE-100 index spiked to 102,664.34 points today, record high in intra day trade by adding 1,307.02 (1.29%).
The index reached peak of 102,737.83 today in its lowest of 101,921.20. Trading volume was 345 million with a turnover of more than PKR 11.38 billion.
The bullish run is a follow through on the recent velocity of PSX as of late, having multiple-high watermark performance out of a slew of these record breaking prints. Analysts state the rise in sales can be attributed to high levels of investor confidence and strong economic signals that will likely positively reverberate through the economy at large.
In the last week PSX managed to scale through the mythical 100k level, finishing at 101357 with a weekly up of 3.6%. There had been selling earlier due to political unrest, which saw sell-off of 3500 pts. But cancellation of protests by PTI helped in a quick rebound followed by good banking sector numbers after the lifting whatever minimum deposit rate (MDR) that existed for Conventional banks in place.
Remaining the Fortesque chariot, local institutional investors (mutual funds and insurance companies) compensate for $15 million of foreign selling and continue the trend. Other economic positives: Falling yields on government bonds rising foreign currency reserves after a ADB $500 million loan) Auto financing posted a gain, to Rs236 billion in October — up 3.7% MoM.
PSX marched irrationally on the (single digit)weekly level. Grounded in an all-time issuance of 98,080 points, it was preceded by largest single-day decline of 3,506 points after political worries. A 4,700 point V-shape turnaround in the middle of the week accounted for what was the largest one-day increase in PSX history. The market rose above 100,000 points on Thursday due to confidence from the recovery economic data. The index finished the week up 3,559 points (3.64%) to a close of 101,357.
Commercial banks (1,676), Technology & Communication (349) and Oil & Gas Exploration companies were some of the key contributors to the rally. The top stocks that were beating the market were Habib Bank Ltd, Bank AL Habib , Pakistan Petroleum, Systems Ltd and Bank Alfalfa.
Expected positive momentum continue on the back of falling inflation and low stock valuations were what the analysts were saying will sustain. The PSX is looking set to outpace growth with November inflation projected at 4.7%
