KARACHI : Stocks rallied on Monday amid bets that central bank was set to extend its hawkish monetary stance in its November 4 meeting; however, late profit-taking dragged the market down from an intraday high above 91,000 points — in a first for the index. Pakistan Stock Exchange’s (PSX) benchmark KSE-100 shares index gained only 201.55 points or 0.22% to close at a yet another all-time high of 90,195.51 after reaching an intraday peak of 91,054.83 points. The market is abuzz with conjectures of a major loosening of the monetary policy stance on November 4, while lucrative corporate results are also spurring buying in sectors such as auto, cement, banking, energy, and power generation. Topline Securities in a note said the session was marked by volatility, with the index swinging between a high of 91,055 and a low of 89,733 points as investors massively booked profits in an overbought market. Expectations of a potential rate cut and robust earnings fuelled upward momentum, the brokerage said adding that Pakistan’s $1.4 billion loan application to China also strengthened morale. Top contributors included Systems Limited , Colgate-Palmolive (Pakistan) Limited, Pakistan State Oil Company Limited, Pakistan Oilfields Limited, and Pakistan Petroleum Limited, which together added 341 points to the index. Trading activity was intense, with a turnover of 566 million shares valued at Rs 29 billion. Fauji Foods Limited, recording 53 million shares, emerged as the volume leader. Commenting on the rally, Tahir Abbas, analyst at Arif Habib Limited (AHL) said: “The market is on a roll, driven by a combination of improved macroeconomic indicators, a stabilised exchange rate, and growing investor confidence following positive government policy initiatives.”
The recent easing of inflationary pressures and declining interest rates have also contributed to increased liquidity, encouraging investors to take fresh positions in equities, Abbas said.
The rupee has been mostly stable against the US dollar in the inter-bank market, while the current account recorded a surplus of $119 million in September.
Sana Tawfik, Head of Research at AHL, that the market was constantly on the rise primarily due to the result season as well as the country’s improved liquidity.
Speaking on the sidelines of the 2024 IMF-World Bank Annual Meetings in Washington DC, State Bank of Pakistan (SBP) Governor Jameel Ahmad expected the foreign exchange reserves of the country to reach $13 billion by the end of this fiscal year (FY2025).
