Karachi, January 24, 2025 – The Pakistan Stock Exchange (PSX) witnessed a robust trading session on Friday as the benchmark KSE-100 index surged by 843 points, fueled by investor optimism over a potential 100 basis points reduction in the benchmark interest rate. This speculation has driven increased market activity, signaling growing confidence among traders.
The KSE-100 index closed the day at 114,880 points, marking a significant rise from Thursday’s close of 114,037 points. During the session, the index experienced an early surge, reaching an intraday high of 115,779.06, reflecting a remarkable gain of over 1,700 points compared to the previous close. However, a wave of late-session profit-taking pared some of these advances, resulting in a net daily increase of 843 points or 0.74%.
Analysts highlighted that Friday’s bullish start was driven by a strong buying spree, underpinned by expectations of monetary easing in the upcoming Monetary Policy Committee (MPC) meeting scheduled for Monday, January 27, 2025. A potential rate cut is anticipated to provide relief to businesses and spur economic activity, fostering a more favorable environment for the equity market.
Additionally, market sentiment was bolstered by the government’s successful passage of legislation on electronic crimes in parliament, a move viewed as a step towards improving regulatory frameworks and governance. However, ongoing political uncertainty, particularly the breakdown of talks between the government and the opposition party Pakistan Tehreek-e-Insaf (PTI), remains a cause for concern among investors.
Thursday’s session also set a positive tone for the market, with the KSE-100 index closing with a gain of nearly 600 points at 114,037. This two-day upward trend reflects growing optimism among market participants as they anticipate favorable policy developments.
Looking ahead, all eyes remain on the MPC meeting, where a 100 basis points rate cut could act as a catalyst for further market gains. Investors are closely monitoring macroeconomic indicators and political developments to gauge their potential impact on the market’s trajectory.
The PSX’s performance underscores the significant influence of monetary policy expectations and political stability on investor sentiment, with Friday’s rally serving as a testament to the market’s sensitivity to economic and legislative cues.