Karachi, April 19, 2024 – The Pakistan Stock Exchange (PSX) witnessed a significant surge in its benchmark index, the KSE-100, as it gained 620 points on Friday.
The KSE-100 index closed at 70,910 points, marking a notable increase from the previous day’s closing figure of 70,290 points.
Analysts at Topline Securities attributed the bullish trend to reports indicating Saudi Arabia’s growing interest in investing in Pakistan. The surge in the KSE 100 Index, which closed at 70,910 level, up by 0.88%, is believed to be driven by news suggesting Saudi Arabia’s potential acquisition of a minority stake in a Pakistan mine controlled by Barrick Gold Corp. This aligns with recent developments indicating Saudi Arabia’s keenness to explore investment opportunities within Pakistan.
Moreover, investor sentiment received a further boost with the State Bank of Pakistan’s reserves increasing by $14.4 million to reach $8.055 billion as of April 12, 2024. This growth occurred despite the repayment of a one billion dollar Eurobond.
Major positive contributions to the index came from prominent companies including HUBC, EFERT, MEBL, BAHL, and OGDC, collectively adding 329 points to the index. Trading activity remained robust, with a total volume of 475 million shares traded, amounting to Rs 23 billion in value. Pakistan Refinery Limited (PRL) emerged as the volume leader for the day, with 49.5 million shares traded.
On a week-over-week basis, the KSE 100 Index recorded a gain of 0.85 percent. This upward momentum can be largely attributed to the recent visit of the Saudi Foreign Minister to Pakistan, where discussions ensued regarding a potential $5 billion investment tranche as part of a broader commitment by Saudi Arabia to invest $25 billion in Pakistan over the next five years.
Other significant developments during the week included the increase in petrol and diesel prices, the LSM Index registering a 0.1% year-over-year growth while declining by 4.1% month-over-month in February 2024, and Pakistan’s car sales for March 2024, which saw a slight decline of 3% month-over-month.
Despite challenges such as the trade deficit for March 2024, which stood at $2.3 billion, indicating a 34% increase on a month-over-month basis, market participation remained healthy throughout the week. The average daily traded volume and value for the week stood at 492 million shares and Rs. 21.3 billion respectively.
Foreign corporate entities also displayed notable interest in the Pakistani market, with net purchases of equities worth $28.91 billion as of the latest closing date. A significant portion of these transactions can be attributed to the delisting of shares of Pakistan Suzuki Motor Company Limited (PSMC) by Suzuki Motor Japan, following the communicated time frame by the company.
Overall, the positive market sentiment driven by the prospect of increased foreign investment and resilient economic indicators contributed to the robust performance of the KSE-100 Index during the week. Investors are closely monitoring further developments regarding potential investment inflows and their impact on the Pakistani economy and capital markets.
