The Pakistan Stock Exchange (PSX) continued its merry run with the benchmark KSE-100 Index closing above 105,000 for the first time on Wednesday, as investors anticipate the State Bank of Pakistan (SBP) to make a further cut in the key policy rate.
At close, the benchmark index settled at at 105,104.34, an increase of 545.26 points or 0.52%.
Buying was observed in key sectors including oil and gas exploration companies, OMCs, power generation and refineries. Index-heavy stocks including HUBCO, PSO, SSGC, MARI, OGDC, PPL, and UBL traded in the green.
The bullish momentum is largely attributed to heightened investor optimism surrounding a potential substantial rate cut in the upcoming monetary policy meeting scheduled for December 16, 2024.
According to a survey released by Topline Securities on Tuesday, the central bank is seen further reducing the key policy rate by at least 200 basis points (bps) in line with the slowing pace of inflation and improved economic indicators.
The brokerage house was of the view that the expectations of a rate cut are driven by high real rates, which stood at 1,010bps in November 2024, well above the historic average of 200-300bps.
On Tuesday, PSX achieved another milestone as the KSE-100 Index surged by nearly 1,300 points to close above 104,000, setting a new record high.
Globally, Asian equities stumbled on Wednesday while currencies were volatile as traders scrambled to contend with the political storm in South Korea, where martial law was imposed and subsequently lifted hours later.
South Korea’s won strengthened in early trading buoyed by suspected intervention but remained close to the two-year low against the dollar it hit late on Tuesday.
The benchmark KOSPI index was down nearly 2%, taking its year-to-date losses to over 7%, making it the worst-performing major stock market in Asia this year.
That left the MSCI’s broadest index of Asia-Pacific shares outside Japan, which counts Samsung Electronics as one of its top constituents, down 0.32% on Wednesday.
Meanwhile, the Pakistani rupee saw a minor decrease against the US dollar, depreciating 0.02% in the inter-bank market on Wednesday. At close, the currency settled at 277.92, a loss of Re0.05 against the greenback.
Volume on the all-share index decreased to 1,749.32 million from 1,766.47 million on Tuesday.
The value of shares declined to Rs50.42 billion from Rs56.62 billion in the previous session.
WorldCall Telecom was the volume leader with 257.53 million shares, followed by Cnergyico PK with 213.20 million shares, and Pak Int.Bulk with 89.65 million shares.
Shares of 467 companies were traded on Wednesday, of which 258 registered an increase, 180 recorded a fall, while 29 remained unchanged.
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