Political Clarity Bolsters Pakistan Stock Exchange (PSX), KSE-100 Rises 0.69%

Key Highlights :

1. The market was range bound throughout the day with slight losses at the end of the day.

2. Political noise and recent developments on the IMF program caused the market to swing both ways.

3. Automobile, cement, chemical, banking and oil sectors were the main sellers while fertiliser space ended with a gain.

4. The market was dragged down by sectors including oil and gas exploration, investment banking, and technology and communication.

     The Pakistan Stock Exchange (PSX) came under the grip of profit booking on Wednesday and the KSE-100 offloaded 0.41% owing to rise in political noise. Expectation of further political deterioration kept market participants at the bay. In addition, rumours that Pakistan will stall the current International Monetary Fund (IMF) programme dented sentiment. At close, the KSE-100 Index was down 172.59 points or 0.41% to settle at 41,833.66.

     However, on Thursday the market managed to recover from the losses and the KSE-100 rose by 0.69%. The market sentiment was bolstered by the clarity in the political situation as the government and opposition parties agreed to form a parliamentary committee to investigate alleged rigging in the 2018 general elections. This helped to ease investor worries and the market regained its footing.

     The sectors that contributed to the rise in the KSE-100 included oil and gas exploration (98.63 points), investment banking (35.46 points) and technology and communication (34.11 points). Volume on the all-share index also increased to 125.5 million from 196.2 million on Tuesday, while the value of shares traded increased to Rs3.5 billion from Rs5.77 billion recorded in the previous session. WorldCall Telecom was the volume leader with 18.4 million shares followed by Fauji Foods with 8.5 million shares and Hum Network with 6.1 million shares. Shares of 319 companies were traded on Wednesday, of which 117 registered an increase, 179 recorded a fall and 23 remained unchanged.

     On the economic front, Pakistan reported a current account surplus of $18 million in April 2023 as compared to a deficit of $640 million in same period last year. This is a positive sign for the economy and has helped to boost investor confidence in the market.

     Overall, the market sentiment is expected to remain positive in the near future due to the political stability and the improving economic outlook. However, the investors should remain cautious and should keep an eye on any developments that may affect the market.

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