The Pakistan Stock Exchange (PSX) saw its benchmark index continue its upward trend on Friday, crossing the 66,000 milestone. The KSE-100 index closed at 66,223.63, up by 1,505.56 points, or 2.33 per cent, from the previous close of 64,718.07. This was the sixth consecutive day of gains for the shares market, with analysts attributing the momentum to declining oil prices and foreign buying.
Arif Habib analysts estimate that for every 1pc conversion from fixed income to equities in the asset under management (AUMs) of Mutual funds and Insurance companies, Rs36bn would be deployed in the market. Mohammed Sohail, chief executive of Karachi-based brokerage firm Topline Securities, also highlighted declining oil prices and continuous foreign buying as contributing factors to the market’s performance.
Investors are focusing on the cheap valuations, settled top-down environment, and the potential for institutional money to rotate into equities. However, Jafri warned that the sharp run-up could lead to enhanced volatility and large intraday swings. Prime Minister Anwaarul Haq Kakar emphasized the importance of sustaining and nurturing the growth in the capital market, highlighting its role as a stabilizing force and calling for efforts to build a capital market that embodies fairness and integrity. The recent performance of the benchmark index was attributed to an improved economic outlook and the participation of foreign investors, as well as the government’s successful signing of the IMF standby agreement and improvements in the fiscal and external accounts.