Bullish momentum witnessed at the Pakistan Stock Exchange (PSX) PSX data portal
The Pakistan Stock Exchange surged past 104,000 points Tuesday, gaining more than 1,000 points a day after data showed inflation fell to a six-and-a-half-year low in November.
The benchmark KSE-100 index rose 1,084.31 points, or 1.05 per cent, to settle at 104,359.25 at 2:47pm. The market initially dropped sharply, falling 449 points in early trading, before rebounding to reach an intraday high of 104,445.80.
The rally followed news that Pakistan’s annual inflation rate dropped to 4.9pc in November, its lowest level since 2017. The country’s trade deficit also narrowed by 19pc year-over-year to $1.59 billion.
“The market is rerating upwards in anticipation of lower interest rates and stronger earnings growth,” said Yousuf M Farooq, research director at Chase Securities. He advised retail investors to maintain a long-term focus and build diversified portfolios through consistent monthly investments.
The November inflation reading pushed real interest rates above 10pc, potentially setting the stage for rate cuts by Pakistan’s central bank, according to Awais Ashraf, research director at AKD Securities.
“Investors have grown more optimistic about the State Bank of Pakistan (SBP) continuing with monetary easing in the upcoming Monetary Policy Committee (MPC) meeting,” Ashraf said, recommending that investors focus on sectors that would benefit from structural reforms and lower rates.
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