The Pakistan Stock Exchange (PSX) continued its bullish run on Monday, driven by positive developments in the IMF loan review and optimism about addressing circular debt in the energy sector.
The KSE-100 Index climbed 663.43 points (0.57%), closing at 116,199.59, up from 115,536.16 in the previous session. The market hit an intraday high of 116,597.89, with the lowest level recorded at 115,883.22.
Key Market Drivers
- IMF Loan Progress
- Over the weekend, the IMF and Pakistan reported significant progress in reaching a Staff-Level Agreement (SLA) under the $7 billion Extended Fund Facility (EFF).
- If approved, Pakistan expects to receive $1 billion as the next tranche of the bailout package, which is seen as a crucial boost for external finances.
- Policy discussions will continue via video conference in the coming days to finalize the agreement, according to IMF Mission Chief Nathan Porter.
- Circular Debt Resolution Efforts
- The government’s focus on circular debt management has boosted investor confidence, particularly in the energy sector.
- The Ministry of Energy revealed that circular debt declined by Rs9 billion in the first half of fiscal year 2024-25, dropping from Rs2,393 billion in June 2024 to Rs2,384 billion by December 2024.
- However, challenges persist, as the government explores a Rs1.2 trillion borrowing plan from commercial banks to manage circular debt—a move questioned by the IMF due to concerns over repayment sustainability.
Market Outlook
- The PSX ended last week on a high note, with the KSE-100 gaining 442 points on Friday, closing at 115,536.16.
- Over the week ending March 14, 2025, the index posted a net gain of 1,137 points (1% week-on-week).
- Analysts expect continued market momentum, contingent on further IMF developments, economic policy clarity, and energy sector reforms.
With investor sentiment remaining positive, the PSX’s upward trajectory reflects growing confidence in economic stability measures, despite lingering structural challenges.
