The Pakistan Stock Exchange (PSX) achieved a remarkable milestone on Wednesday as the benchmark KSE-100 Index soared to a historic intraday high of 96,711.33 points. This gain of 854.67 points, or 0.89%, from Tuesday’s close of 95,856.66 reflects a data-driven rally propelled by improved economic indicators and fiscal projections.
Factors Driving the Rally
Despite political tensions sparked by an opposition protest call for November 24, investor optimism remained resilient. Sectors such as cement, banking, fertiliser, oil and gas exploration, oil marketing, and power generation dominated trading activity, with substantial gains recorded in key stocks. Major contributors included K-Electric, Pakistan State Oil, Shell, Oil and Gas Development Company, Pakistan Petroleum, Mari Petroleum, Meezan Bank, National Bank of Pakistan, and Habib Bank.
Economic Indicators Supporting Growth
Several macroeconomic factors bolstered the positive sentiment:
- Foreign Direct Investment (FDI): FDI surged 32% year-on-year to $904 million during July-October 2024.
- Current Account Surplus: October recorded a surplus of $349 million, marking the third consecutive month of positive figures, aided by a 7% month-on-month and 24% year-on-year rise in remittances.
- Foreign Exchange Reserves: Reserves reached a two-year high and are expected to exceed $11 billion soon.
- Inflation Trends: November’s Consumer Price Index (CPI) is forecasted to decline to between 4.5% and 5%, the lowest in 78 months. Inflation for FY25 is projected at an average of 7.5%.
Technology Sector Leading the Charge
The technology sector played a significant role in the rally, driven by robust growth in export remittances from the Information and Communication Technology (ICT) sector. ICT remittances rose 34.9% year-on-year to $1.206 billion in the first four months of FY25, with October alone recording a 38.6% increase to $330 million.
Looking Ahead
The rally builds on Tuesday’s strong performance, when the KSE-100 Index hit an intraday peak of 96,036 points before closing at 95,857. With encouraging economic data and a renewed focus on stability, the market appears poised to sustain its upward momentum in the coming weeks.
