The Pakistan Stock Exchange (PSX) continued its record-breaking rally on Friday, driven by investor optimism ahead of major corporate earnings announcements and expectations of monetary easing. The benchmark KSE-100 Index soared to an intraday high of 140,585.38 points, gaining 1,919.89 points (1.38%), while the lowest level recorded was 138,551.61 points. Analysts attributed the surge to strong expectations of robust financial results and potential interest rate reductions.
Ahsan Mehanti, MD of Arif Habib Commodities, stated that the rally was fueled by anticipation of strong earnings and possible SBP policy easing amid low inflation. Similarly, Sana Tawfiq, Head of Research at Arif Habib Limited, noted that while the bullish trend is likely to persist during the earnings season, intermittent profit-taking could occur. Investor sentiment was further boosted by Finance Minister Muhammad Aurangzeb’s recent comments suggesting room for interest rate cuts, though the final decision rests with the SBP.
The bullish momentum was reinforced by rising foreign exchange reserves, which climbed to $14.526 billion, surpassing IMF targets. Additionally, the government’s successful PIB auction, raising Rs342 billion against a Rs300 billion target, signaled strong investor confidence. Yields on bonds declined across various tenors, further fueling expectations of monetary easing.
The rally followed Thursday’s surge, where the KSE-100 had gained 2,285 points (1.68%), closing at 138,665.49. With corporate earnings season in full swing and monetary policy decisions looming, market participants remain optimistic, though cautious of potential corrections in the near term. The next SBP policy meeting, expected by late July, will be a key event to watch.