Pakistan stock market breaches 130,000 barrier amid low inflation, surging oil prices
The development takes place a day after Pakistan's KSE-100 Index closed at an impressive 128,199.42 points on the first day of the new fiscal year, with Prime Minister Shehbaz Sharif calling the stocks' performance a sign of growing investor confidence in the economy and government policies. The latest milestone builds on a strong showing in the previous fiscal year, when the KSE-100 Index rose by 60 percent, according to Karachi-based Topline Securities.
The Pakistani stock market closed at 130,344.03 points when trading ended on Wednesday. Continuing its bullish momentum, the index surged by 2,144.61 points, recording a gain of 1.67 percent from the previous day's close.
'Stocks closed at new all-time high in the earning season at PSX as investors weigh drop in CPI inflation to 3.2 percent YoY and upbeat data on POL sales surging by 7pc for June 25,' Ahsan Mehanti, chief executive officer at Arif Habib Commodities Limited, said.
Mehanti said higher global equities and Pakistani power regulatory authority's recent move to slash the base power tariff for industries for the current fiscal year also played a role in the bullish close. He also paid credit to surging crude oil prices, saying they had played a 'catalyst role' in the surge.
Karachi-based brokerage firm Topline Securities said the surge was fueled by 'aggressive institutional buying' and a wave of fresh fiscal-year optimism among investors.
'With the index in uncharted territory, all eyes are now on earnings season and macro signals to see if the bulls have more steam left or if a breather is around the corner,' it said in a statement.
Pakistan's stocks surge as Islamabad seeks to consolidate its financial recovery after years of economic turbulence.
In recent years, the country has undertaken difficult structural reforms under International Monetary Fund loan programs aimed at curbing fiscal deficits and restoring investor trust.
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