Stocks bounce on positive domestic and regional cues

The Pakistan Stock Exchange (PSX) extended its winning streak on Thursday, with the KSE-100 index up 2,473.55 points, or 1.56%, to close at 160,657.50. Trading remained firm throughout the session as the index touched an intraday high of 160,944.51 and a low of 158,971.49. The upbeat sentiment reflected renewed investor confidence due to political progress, improved security conditions and a calmer regional outlook.

The rally was broad-based, with major sectors such as cement, fertilizers and oil and gas leading the way. Investor confidence improved sharply as signs of political calm and regional stability supported a broad market recovery. Participants saw recent political progress as a move toward more stable governance, helping to restore faith in the continuation of economic reforms. The more predictable environment encouraged renewed interest in major sectors, with sentiment turning decidedly positive during the session.

Momentum was also boosted by a series of encouraging domestic and regional updates. The Sri Lankan cricket team’s decision to go ahead with their tour of Pakistan after fresh security assurances was taken as a strong signal of growing international confidence in the country’s stability. At the same time, a successful clearance operation against terrorist elements in Khyber Pakhtunkhwa reassured investors about the security landscape. On the diplomatic front, the Indian cabinet’s measured response to the Delhi blast, which avoided any direct reference to Pakistan, eased cross-border concerns. Collectively, these developments fostered a sense of calm and optimism, leading to strong buying interest across the board.

KTrade Securities equity trader Ahmed Sheraz wrote that the PSX saw a strong reversal of fortunes on Thursday as the KSE-100 rose 2,473 points (+1.56% DoD) to close at 160,657. The rally was broad-based with major sectors such as cement, fertilizers and oil and gas all recording significant gains.

Reading: PSX plunges 3,668 points as 27th Amendment, terror reports spark sell-off

Market sentiment improved due to multiple positive developments. The passage of the 27th Constitutional Amendment in Parliament was seen as a step towards political stability. Confidence was further boosted when the Sri Lankan cricket team decided to go ahead with their tour of Pakistan following renewed security assurances. In addition, a successful clearance operation in Khyber Pakhtunkhwa and the Indian cabinet statement on the Delhi blast — notably without mentioning Pakistan — helped ease concerns, collectively supporting market momentum.

The rally was led by strong performances in blue-chip stocks like Fauji Fertiliser, Lucky Cement, Maple Leaf Cement, DG Khan Cement, Mari Energies, Fauji Cement, Cherat Cement, Hub Power and Pioneer Cement, which together contributed significantly to the day’s surge. In addition, MLCF and PIOC hit their senior circuits (10%) after MLCF announced it would acquire a controlling stake in PIOC.

Despite the strong upward movement of the index, overall market participation remained relatively subdued. Looking ahead, Sheraz expects sentiment to remain closely linked to developments on the law and order situation, the political landscape and the macroeconomic front, particularly the release of the upcoming IMF tranche and evolving regional geopolitical dynamics.

Total trading volume jumped to 797.1 million shares against Wednesday’s 757.2 million, while the value of shares traded stood at Rs 35.1 billion. Shares of 477 companies were traded, of which 285 closed higher, 142 declined and 50 remained unchanged. Bank Makramah emerged as the volume leader with 112.2 million shares, rising Rs0.02 to close at Rs5.59.