Bulls took control of the trade floor on Monday as shares at the Pakistan Stock Exchange (PSX) climbed more than 900 points in intraday trade after a week of volatility.
The benchmark KSE-100 index climbed by 941.79 points, or 0.82 per cent, to stand at 116,411.13 from the previous close of 115,469.34 at 10:05am.
Yousuf M. Farooq, director research at Chase Securities, noted that the country’s monthly current account remained “in a comfortable position”, in addition to corporations “posting strong profits”.
In other positive developments, Farooq added that inflation was at a record low, and the real effective exchange rate (REER) stood at 101.
“The market opened slightly higher today, supported by relief that no major escalation occurred between India and Pakistan over the weekend [following the Pahalgam attack],” he added.
“With most market participants expecting interest rate cuts ahead, there is potential for a rerating of the market’s PE [price-to-earning] multiple,” he said.
“However, a significant upward move will likely require de-escalation between India and Pakistan.”
Mohammed Sohail, chief executive of Topline Securities, also attributed the positive momentum to “dust settling down” between Pakistan and India after the Pahalgam attack, with “no major incidents” supporting market recovery.
AKD Securities noted that the market had remained volatile last week due to escalating geopolitical tensions following the Pahalgam attack, and India’s subsequent suspension of the Indus Waters Treaty with Pakistan in the aftermath of the incident, undermining investor sentiment.
However, positive news stemmed from the International Monetary Fund’s (IMF) World Economic Outlook for Apr’25, lowering Pakistan’s inflation forecast for FY25 to 5.1%YoY (earlier: 10%YoY) and 7.7%YoY for FY26. On the flip side, growth projection for FY25 was revised slightly downward to 2.7%, from 2.8% previously.
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