Bulls make strong comeback at PSX after US hailed Pakistan

By Syed Raza Hassan

KARACHI: Pakistan Stock Exchange (PSX) on Thursday rebounded rising (1.30%) or 1,459.41 points closing at 113,713.17 level owing to positive sentiment by US recognition of Pakistan efforts in capture of top ISKP militant.

The equity market witnessed a robust rebound in Tuesday’s session, with the benchmark index surging to an intraday high of 1,617 points.

The rally was primarily driven by a sharp decline in international oil prices, which plunged to multi-year lows, uplifting investors sentiment, said Topline Securities in its alert.

“Public recognition of Pakistan’s efforts by US President Trump has helped alleviate concerns about US-Pakistan relations under the new administration. Investors are optimistic about the successful completion of the IMF review and the potential for additional funding through climate financing,” Muhammad Awais Ashraf, analyst at AKD Securities, told Hum News English.

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He said a sharp decline in inflation, a 6.5% drop in oil prices during the week, and a decrease in exports during February have raised expectations of a rate cut in the upcoming Monetary Policy Committee meeting.

Further monetary easing would enhance the appeal of equities compared to fixed-income securities, Ashraf added.

Moreover, speculation surrounding high-level meetings on the clearance of the long-standing circular debt further fuelled optimism across the board, Topline note added.

“Market opened on a positive note and continued its upward movement throughout the session. The positive trend was largely attributable to the IMF review, on which the Bloomberg report said Pakistan is likely to clear its first review of a $7 billion IMF loan. 

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The market is also anticipating the upcoming monetary policy announcement due on March 10 as one of the positives since it is largely being anticipated that there could be a 100 basis points reduction in the policy rate,” Darson Securities CEO Sheheryar Butt said.    

The rally was predominantly led by PPL, OGDCL, MARI, PSO, and SNGP, which collectively contributed 835 points to the index.

Market participation remained strong, with a total of 372 million shares changing hands, generating a turnover of Rs26.2 billion. PIBTL dominated the volume charts, leading with 48 million shares traded.