Stocks on Friday broke through the 90,000-point psychological barrier, fueled by positive economic indicators and optimism for a major downward revision in the monetary policy rate by the central bank at its November 4 meeting.
The Pakistan Stock Exchange's (PSX) benchmark KSE-100 Shares Index gained 1,100.32 points to jump to 90,046.3 points during the intraday trade, up from yesterday's close of 88,945.98 points.
Arif Habib Limited's Head of Research Tahir Abbas told Thenews.com.pk that the market's overall momentum was positive.
"If you look at the economic indicators like remittances, current account, etc, they are improving, which is affecting the market positively," the analyst said.
He noted that, with inflation on a downward trajectory, the interest rate was expected to see a further cut of 2% to 2.5% in the upcoming monetary policy meeting on November 4, 2024.
"Even though stocks have been rallying for some time, valuations are still attractive and cheap, while the market is trading at a price-to-earnings ratio of 4.2x, while its six-year average is around 6x," Abbas said.
The analyst further said that there was an ample flow of liquidity in the stocks, and since fixed-income investments were not offering solid returns, investors were entering the equities. "This shift is driving value buying in the market," he added.
This a developing story and is being updated with more details.
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