Bulls decided to take control of the trade floor at the Pakistan Stock Exchange (PSX) on Monday as shares gained more than 2,900 points in intraday trade.
The benchmark KSE-100 index climbed 2,920.68, or 2.62 per cent, to stand at 114,271.85 from the previous close of 111,351.17 at 2:18pm.
Awais Ashraf attributed today’s movement to be driven by the year ending “as institutions aim to close their portfolios at higher rates”.
Additionally, he highlighted that the “successful rollover” of approximately Rs55 billion in futures was contributing to this trend.
“We believe, KSE-100 Index is set to post another year of strong returns, as interest rates are anticipated to fall to single digits in 2025 due to a strong external account,” he said.
“Falling returns from alternative investments are expected to make equities the preferred asset class in 2025,” he added.
We forecast the KSE-100 Index would reach 165,215 by Dec’25, providing a 45% return (41% in USD terms). Furthermore, the focus on structural reforms and tight fiscal and monetary policies under the IMF program is expected to improve the investment climate and support market rally.
Yousuf M. Farooq, director research at Chase Securities, said, attributed the climb to remarks by Finance Minister Muhammad Aurangzeb on Sunday who suggested that inflation for the month could clock in between 4-5pc and that single-digit interest rates were a possibility.
On Sunday, while talking about achieving sustainable growth, the finance minister noted that inflation had slowed down to nearly 5pc, with the interest rate down to 13pc.
“These are all the things that indicate that the wheel of the economy has started moving and I would be the last person to say that we have achieved whatever we said — however, in the last six months the macroeconomic stability which makes the foundation is there so that we can achieve sustainable growth,” he said.
However, he cautioned that the country was still an “import-led economy” and it was critical to ensure that they headed towards export-led growth, adding that they had created the foundation where in 2025 they could head towards sustainable growth.
More to follow
