The Pakistan Stock Exchange (PSX) resumed its strong rally on Friday as the benchmark KSE-100 index touched the highest level of 61,779.72 points for the first time in its history.
The index gained 1159.98 points or 1.92% up to close at 61,691.25 points compared to 60,531.27 points on Thursday.
The benchmark index also crossed the 61,000 points milestone on Wednesday but could not sustain the record level and ended up in the red zone.
The buying spree was broad-based on Friday, with all major sectors contributing to the index’s rise. The automobile assemblers, cement, chemical, commercial banks, oil and gas exploration, OMCs and refinery sectors were among the top performers.
DG Khan Cement, Maple Leaf Cement, Fauji Cement, Pioneer Cement, Oil and Gas Development Company, Pakistan Petroleum, Pakistan State Oil, Hub Power Company and Habib Bank were some of the prominent gainers.
The PSX has been on a winning streak since the start of November, posting a return of 16.6%, the highest monthly return since March 2009. The index has gained 26.4% year-to-date, making it one of the best performing markets in the region.
The market reacted positively to the improvement in the country’s financial indicators, such as the increase in foreign exchange reserves and the expected decline in the policy rate. The rupee also strengthened against the US dollar in the interbank and open markets.
Record inflows in November
The Pakistan Stock Exchange has also attracted significant foreign inflows in the month of November, recording a net buying of $34.5 million, the highest since January 2018.
This confidence from overseas investors has resurfaced amid hopes of improved economic conditions following the expected inflows from the IMF and friendly countries, relatively stable currency amid government-backed administrative efforts, and a possible slash in the interest rates.
The dominant buyers during the month were foreign corporates, with a net investment of $35 million. They allocated the majority of their capital to commercial banks, cement, power generation and distribution, oil and gas marketing companies, and fertilizer sectors.
On the flip side, they divested from the oil and gas exploration sector, amounting to $6.98 million in sales.
Meanwhile, foreign individuals and overseas Pakistanis sold equities worth $0.37 million and $0.14 million respectively during the month.
The PSX is expected to maintain its upward momentum in the coming days, as investors anticipate positive developments on the economic and political fronts. The market is also likely to benefit from the seasonal factors, such as the year-end window dressing and the upcoming corporate results.