The Pakistan Stock Exchange (PSX) hit a new all-time high of over 63,500 points before midday on Wednesday as the return of foreign investors to the local bourse gave local investors confidence to continue buying stocks.
The benchmark KSE-100 index PSX hit a fresh high of 63,611.50, up 1 percent, or 655.48 points, during trading on Wednesday compared with Tuesday’s close of 62,956.02.
The market staged its fastest rally in two decades, rising nearly 60%, or more than 23,600 points, in just over five months to date. The index was set at around 40,000 units in June 2023.
Reading An improving economy pushes the PSX to new highs
Market talk shows that foreign investors are making renewed purchases on the PSX after the rupee-dollar rate stabilised, early signs of economic recovery emerged and political stability returned with preparations for the next general election scheduled for February 2024.
Investors remained net sellers in the market for a few years, mainly due to high volatility in rupee-dollar exchange rates. The exchange rate has remained stable near and around Rs 285 against the US dollar for the past three weeks, encouraging investors to take fresh positions in the PSX.
Power and telecom penny stocks, e.g. K-Electric and WorldCall Telecom (WTL), were the top two volume traders, followed by Pakistan Refinery Limited (PRL) and other energy stocks.
read more PSX predicts 32% growth through December 2024
Arif Habib Limited (AHL) has forecast a 32% rise in the benchmark over the next 13 months to 81,000 units in December 2024, believing that the availability of huge liquidity with investors would pave the way as share prices remain subdued despite notable development in recent months.
However, it is important to recognize the key downside risks to AHL estimates. “These include the vulnerability of the PKR (rupee-dollar exchange rate) to global and local macro- and geopolitical developments, the looming threat of a global macro-slowdown, the resurgence of international commodity prices, political instability and highly aggressive structural reforms. which could hurt growth in the short to medium term.”
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