The Pakistan Stock Exchange (PSX) achieved a historic milestone on Tuesday, with its benchmark KSE 100 index surging past 166,000 points for the first time ever. The robust performance reflects growing investor confidence and a series of positive economic and geopolitical developments.
During intraday trading, the index climbed to a peak of 166,556.29, marking a substantial gain of 2,708.61 points, or 1.65 percent. Even at its lowest point of the day, the index remained significantly up at 164,208.33, reflecting broad market strength. This latest surge extends a remarkable third consecutive day of record-setting activity, following Monday’s close at an all-time high of 163,847 points.
Analysts attribute the sustained upward momentum to a confluence of factors. Samiullah Tariq, head of research and development at Pak Kuwait Investment Company Ltd, noted strong corporate results and increased market liquidity favoring equity investments. “Strong corporate results and additional liquidity in the market, with a preference for equities, are pushing the market higher,” Tariq told Dawn.com.
The rally has been further fueled by aggressive buying from local mutual funds and significant institutional inflows. Earlier in the week, the index had already surpassed the 162,000-point threshold, driven by key economic and strategic advancements. These include the finalisation of a 1.275 trillion Pakistani Rupee financing facility with 18 commercial banks aimed at tackling the power sector’s persistent circular debt, and a strategic defence agreement with Saudi Arabia, which has ignited hopes for enhanced bilateral trade and financial support.
Yousuf M. Farooq, director of research at Chase Securities, described the market as being “firmly in its optimism phase.” He added that this sentiment is “supported by signs of an economic recovery and a steadily improving geopolitical news flow.” Farooq also highlighted fresh retail participation alongside sustained mutual fund inflows as key drivers, noting that “all eyes are now on the ongoing International Monetary Fund (IMF) review, which most participants expect to conclude smoothly.”
Awais Ashraf, director of research at AKD Securities, echoed this optimism, pointing to investor anticipation of a successful review by the IMF and the potential for increased foreign direct investment, bolstered by improved diplomatic relations with the United States and Saudi Arabia.
As the government enters crucial negotiations with the IMF, market participants are hopeful that positive progress will further bolster investor confidence. However, some analysts remain cautious, acknowledging lingering concerns regarding the review’s outcome and its broader impact on Pakistan’s fiscal stability, with the achievement of IMF-set targets still presenting a significant challenge.
