KARACHI, JULY 6, 2023: The Pakistan Stock Exchange (PSX) witnessed another bullish run on Thursday as the KSE-100 Index closed well over the 44,000 points.
On the fourth day of the business week, the 100 index closed at 44,178 with an increase of 626 points. This is the first time the index has closed over the 44,000 level since May 2022.
The experts are of the view today’s rally is due to the standby agreement with the IMF and payments made to independent power producers (IPP) that boosted their shares.
Aba Ali Habib Securities Head of Research Salman Naqvi said the agreement with the IMF had ended several uncertainties, including the risk of default.
He said Pakistan then had some breathing space, and it could then concentrate on its fiscal policies. Furthermore, he added the government had paid around Rs140 billion to IPPs, following which several of them would now be able to pay high dividends.
This was why they were seeing a rally in their shares, he said adding positive momentum was also seen in the cement sector due to a reduction in the international prices of coal, which is used as a fuel for cement production.
Dalal Securities CEO Siddique Dalal disclosed the momentum in the stock market was led by the IMF agreement.
Overall, the index could reach up to 45,000 to 46,000 points but the rise would not be consistent, he predicted, recalling that it had slumped over the past two days after a historic bull run on Monday.
“The sentiment has improved but inflation is also to be considered,” he said, adding that the market would not be consistent and the rise would not be long-lasting.
The stock market had witnessed the highest single-day gain on Monday after Pakistan secured a badly-needed $3bn short-term financial package from the IMF last week, giving the economy a much-awaited respite as it teeters on the brink of default.