The Pakistan Stock Exchange (PSX) has reached new heights, with the KSE-100 index hitting an all-time high of 90,871 points during intra-day trading. This marks a continuation of the bullish trend observed in previous weeks.
Read more: PSX-100 Index Reaches Historic Milestone, Surpasses 90,000 Points for the First Time
Key Highlights:
- Trading Surge: On the first business day of the week, the KSE-100 index opened with a surge of 646 points, climbing to 90,640 points. The index ultimately gained 877 points, reflecting strong investor confidence.
- Historical Milestone: Last week, the index surpassed the 89,000 mark and achieved the 90,000 threshold during intra-day trading, which had been previously recorded at 90,087.41 points early on a Friday session.
- Market Dynamics: A total of 62,341,937 shares were traded, amounting to a transaction value of Rs5,057,954,342. This strong participation is attributed to positive economic reforms and government initiatives, positioning Pakistani stocks as undervalued relative to regional markets.
- Price-to-Earnings Ratio: The KSE-100 index currently trades at an average price-to-earnings (P/E) ratio of 5.3, significantly lower than the regional average of 12-15, making it attractive for both local and foreign investors.
- Interest Rate Outlook: Analysts expect the State Bank of Pakistan (SBP) to announce a reduction in interest rates, driven by easing inflationary pressures. Yields on government bonds have already dropped by 100-150 basis points, indicating market expectations for potential rate cuts. By the end of December, interest rates are anticipated to be around 14%, with expectations of a cumulative reduction of 350 basis points in the coming months.
Meanwhile, gold has emerged as a safe haven for investors globally, reaching a record high of $2,758 per ounce last week, with forecasts suggesting potential rises towards $2,800-3,000 per ounce in the medium to long term. However, experts warn of a possible correction of $300-500 per ounce around the first quarter of 2025, with small profit-taking expected through December 2024.
The PSX’s performance, alongside the rising gold prices, reflects a broader trend of investment optimism, bolstered by anticipated economic improvements and a favorable investment climate.
