KARACHI: The Pakistan Stock Exchange (PSX) on Tuesday has been observing bullish trend amid presence of positive triggers with a new 17-month high of 43,468.22 points before falling back to 43,255.96 points at 12.17pm.
On Monday, the benchmark KSE-100 Share Index closed at 43,218.67.
The previous week witnessed massive overall spike in the stocks as local and foreign investors rampaged across the market to quickly hit upper circuits after the war clouds hanging over the region due to US-Iran hostilities dissipated which provided the investors the much-needed comfort to move funds from gold and money market back to risky assets that may provide higher returns.
On a weekly basis, the benchmark KSE-100 Share Index was tossed up by 883.75 points as Friday’s Index ended at 43,207.05 points.
With an additional eye-popping gains of 1,166 points delivered on last Thursday, the index raced up by total 1,849 points or 4.43pc, which represents the highest two-day increase since May 23, 2019.
There was no major negative news flow that could thwart the market exuberance. On the political front, the belligerent atmosphere in the country took a pause after some reconciliation between the government and the opposition following the consensus passage of Army, Air Force and Navy Amendment Bills.
Earlier, investors’ optimism continued as they saw the market back in the green after two earlier dismal years of negative returns.
From Aug 16, 2019 when the benchmark index had hit the pit at 28,765 points, the market has witnessed a spectacular rally that has carried it up by 50pc in fewer than five months.
Major developments earlier were, firstly, inflow of $1.3 billion from Asian Development Bank (ADB) for budgetary support and to address power sector reforms, secondly, worker remittances during November which stood at $1.8 billion (up 9.4 percent as compared to the same month last year), thirdly, forex reserves reaching $16 billion, up by 0.4 percent on a weekly basis, excluding tranche received from ADB, and fourthly, the latest PIB auction that saw 10-yr PIB cut off below 11 per cent that was last seen in Oct.18.
Improvement on the external front together with stability in the Pakistani Rupee was expected to reassure foreign investors.
Meanwhile, inflationary readings are set to touch peak in January 2020 (this month) with an imminent interest rate cut to follow, domestic investors remain jubilant as well, he said.
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