Karachi, February 28, 2024 – Pakistan equities experienced a gain of 484 points on Wednesday, propelled by optimistic sentiments fueled by hopes of an upgrade in Moody’s rating, which suggested reduced government risks.
The benchmark KSE-100 index of the Pakistan Stock Exchange (PSX) concluded at 63,703 points, marking a significant increase from the previous day’s closing at 63,219 points.
Ali Najib, Senior Dealer at Topline Securities Limited, highlighted the positive trajectory of Pakistan equities throughout the trading session, noting that the market remained bullish, closing the day with a gain of 484 points, representing a 0.77 percent increase.
The momentum in buying activity can be attributed to several key factors. Firstly, there was increased clarity regarding the formation of a new government, providing investors with a sense of stability and direction. Secondly, optimism was fueled by news suggesting that Pakistan’s rating might be “upgraded” if the government successfully mitigates external and liquidity risks, as indicated by Moody’s, an international rating agency.
The impact of these developments was visible in the across-the-board buying momentum, with various sectors contributing positively to the index. Notable contributions came from the Fertilizer, Cement, Bank, and Exploration & Production (E&P) sectors. Companies such as Fauji Fertilizer Company (FFC), Engro Fertilizers (EFERT), Lucky Cement (LUCK), MCB Bank (MCB), and Oil & Gas Development Company Limited (OGDC) collectively added 314 points to the index.
The total volume of shares traded at the PSX during the day reached over 461 million, with a total value of Rs 15.9 billion. CNERGY led the volumes chart with the trading of over 62.1 million shares.
The positive market response underscores the significance of external assessments by global rating agencies such as Moody’s. Investors closely monitor such reports as they influence market sentiments and investment decisions. A potential rating upgrade by Moody’s would signal increased confidence in Pakistan’s economic and financial outlook.
While the surge in equities reflects short-term market dynamics, it also underscores the importance of ongoing efforts to address government risks and improve external and liquidity conditions. Investors and market participants will be keenly observing future developments, including government policies and economic indicators, to assess the sustainability of the positive momentum in Pakistan’s equities market.
