Shares at the Pakistan Stock Exchange (PSX) surged over 700 points in intraday trading on Monday amid expectations of declining inflation.
The KSE-100 index rose by 704.08 points, or 0.9%, reaching 79,149.04 by 11:15 am, up from the previous close of 78,444.96.
Mohammed Sohail, CEO of Topline Securities, mentioned that investors were actively establishing new positions in anticipation of a lower Consumer Price Index (CPI) reading.
He also anticipated a forthcoming staff-level agreement with the International Monetary Fund (IMF) following the approval of a tax-heavy budget.
Amreen Soorani, Head of Research at JS Global, noted the bullish sentiment at PSX, driven by optimism for an IMF agreement post-Finance Bill approval. She highlighted Pakistan’s market appeal, noting its low trading multiples despite substantial gains, attracting investors relative to global markets.
Raza Jafri, CEO of EFG Hermes Pakistan, pointed out that the fiscal year 2025 budget approval marked significant progress toward securing an IMF program, a move welcomed by investors.
He also looked forward to the upcoming inflation report and anticipated continued rate cuts in future monetary policies, which he said are drawing local investments into equities.
Yousuf M. Farooq, Director of Research at Chase Securities, linked the market’s positive movement to the passage of the budget, which he believes will facilitate Pakistan’s entry into its next IMF program.
He suggested a new IMF program would stabilize external factors and monitor Pakistan’s fiscal health.
He also predicted that lower inflation would gradually decrease interest rates and a market re-rating.
