Stocks in Pakistan surge by 3% on a weekly basis, outperforming other financial assets.
Pakistan Stock Exchange (PSX) Records 3.08% Weekly Gain
The Pakistan Stock Exchange (PSX) has witnessed a significant increase of 3.08% over the past week, reaching one of the highest levels in recent months. The benchmark KSE-100 Index closed at 145,383 points on Friday[1][2][3].
The rise in the PSX can be largely attributed to robust corporate earnings expectations, sustained buying activity by mutual funds, optimism over circular debt resolution, increased market participation, and improved liquidity[2][3][5].
Investors were encouraged by better-than-expected earnings from companies during the ongoing results season, boosting market sentiment[2][3][5]. Progress or expectations of resolution in circular debt within the power sector also supported confidence in the market[2][3][5].
Fresh capital inflows into mutual funds kept demand for equities high, making stocks attractive compared to other assets[1][4]. Average daily traded volume rose 16.3% week-on-week to 653 million shares, reflecting active participation and confidence among investors[2][4].
While the trade deficit widened 44% YoY to $2.8 billion due to higher imports, remittances increased 7% YoY to $3.2 billion, providing some support to external financing needs[1][2][3]. Additionally, the Pakistani rupee appreciated slightly against the USD, enhancing market sentiment[1][2][3].
Specific sectors like cement saw a 30% YoY growth in dispatches, and positive policy moves such as increased US tariffs on Indian goods suggested potential export benefits for Pakistan, especially textiles[4].
Profit-taking and some volatility toward the end of the week slightly trimmed the gains but did not undo the week’s strong rally[3][4].
However, it's worth noting that the PSX did not cross the 140,000-point barrier this week, and the exchange closed the weekend session at 145,382.79 points on Friday[1]. Furthermore, the report indicates a decrease in foreign exchange reserves held by the central bank, with a weekly decrease of $72 million to reach $14.2 billion as of August 1[1].
References:
- The News International
- Dawn
- Business Recorder
- Pro Pakistani
- The Express Tribune
- The surge in the PSX might encourage more investors to delve into the art world, viewing it as a profitable avenue for investing due to the gains displayed in the stock market.
- The flourishing business environment, coupled with positive news about financial investments and robust earning expectations, could lead to an increase in news coverage about the art industry, given the potential for significant returns.
