KSE-100 Shatters Records as Bullish Momentum Persists
The Pakistan Stock Exchange (PSX) witnessed a bullish session on Monday, with the benchmark KSE-100 index closing at a record high of 69,620. This surge of 1,274.66 points on a week-on-week basis comes amidst positive economic indicators and increased investor activity.
Bullish Momentum Fueled by Easing Inflation and Foreign Investment
Analysts attributed the recent stock rally to a decline in inflation. Year-on-year inflation for March 2024 clocked in at 20.68%, turning real interest rates positive for the first time in 38 months. This raised hopes for a policy rate cut by the central bank, potentially leading to increased economic activity and corporate profitability.
Furthermore, foreign investors and institutions actively participated in the market, injecting additional liquidity and supporting the market’s upward trajectory. This follows a similar trend observed the previous week, where both local and foreign investors, coupled with institutional support, propelled the bourse forward.
Energy Sector Leads the Charge
The index-heavy energy sector played a pivotal role in Monday’s gains. Stocks of prominent companies like OGDC, PPL, PSO, SSGC, and SNGPL all closed in positive territory. This sector’s positive performance reflects optimism surrounding the oil and gas industry in Pakistan.
PTCL Acquisition Receives Boost, OGDC Announces Gas Discovery
On the corporate front, positive news emerged for the telecommunication sector. The Board of Directors of the International Finance Corporation (IFC) approved debt financing of up to $400 million for Pakistan Telecommunication Company Limited (PTCL) following its acquisition of Telenor Pakistan (Private) Limited. Additionally, Oil & Gas Development Company Limited (OGDCL) announced the discovery of tight gas at its exploratory well Nur West # 01, located in Sindh province. This discovery has the potential to boost Pakistan’s domestic gas production.
Market Activity Sees Slight Decline
While the broader market sentiment remained bullish, the total volume and value of shares traded on Monday saw a slight decrease compared to the previous session. The all-share index volume dipped marginally to 335.83 million from 388.75 million, and the value of shares traded declined to Rs15.3 billion from Rs17.9 billion.
Looking Ahead
The PSX’s record-breaking performance on Monday reflects growing investor confidence in the Pakistani economy. With positive economic data and continued investor activity, the Pakistani stock market is poised for further growth in the coming weeks.