Pakistan stocks surged on Thursday, with the KSE-100 index rising by 634 points, as Saudi Arabia announced a substantial $2 billion additional deposit to support the country’s economy.
The Pakistan Stock Exchange (PSX) closed at 40,351 points, up from the previous day’s close of 39,717 points, bolstered by a wave of investor confidence.
Analysts at Arif Habib Limited described Thursday’s stocks momentum as bullish, with the day’s gains attributed to renewed investor optimism spurred by Saudi Arabia’s commitment. The Saudi deposit is expected to ease Pakistan’s foreign exchange reserves, a crucial step in unlocking the next tranche of the International Monetary Fund’s (IMF) Extended Fund Facility (EFF). This move by Saudi Arabia removes a significant hurdle in Pakistan’s economic recovery efforts, providing much-needed support to the country’s balance of payments and increasing the likelihood of further financial assistance from international partners.
The benchmark KSE-100 index opened in positive territory and stayed in the green throughout the trading session. Investor enthusiasm was evident as the index reached an intraday high of 657.18 points, reflecting a significant increase in buying activity across multiple sectors. Among the best-performing sectors were Exploration & Production (E&P), Cement, Fertilizer, Technology & Communication, and Commercial Banks. The E&P sector led the charge, contributing 202.2 points, followed by Fertilizer with 85.4 points, Cement with 75.7 points, Technology & Communication with 60.2 points, and Commercial Banks with 49.8 points.
Trading volumes at Pakistan stocks witnessed a substantial rise, doubling from 86.7 million shares on the previous day to 171.4 million shares, marking a 97.6% day-on-day increase. In addition, the average traded value surged by 110.7%, reaching USD 17.8 million compared to USD 8.4 million in the prior session. This robust volume growth reflects investors’ eagerness to capitalize on the positive market sentiment and invest in blue-chip stocks across various sectors.
Key stocks that drove trading volumes included Silkbank Limited (SILK), Pakistan Petroleum Limited (PPL), Telecard Limited (TELE), Oil & Gas Development Company (OGDC), and Worldcall Telecom Limited (WTL).
Market participants are optimistic that Saudi Arabia’s support will not only stabilize the country’s financial standing but also restore investor confidence in Pakistan’s economic outlook. The anticipated IMF funds, alongside Saudi assistance, are expected to further strengthen Pakistan’s foreign reserves, providing relief to a market that has been grappling with economic challenges in recent months. The outlook for the PSX remains positive, with hopes that foreign inflows will continue to drive market gains in the near term.