Optimism drives KSE-100 to record high on hopes of steeper rate cuts

KARACHI: The bull run at the Pakistan Stock Exchange is still going strong. On Tuesday, the KSE-100 index surged by another 1,284 points to another record high amid expectations for a higher cut in the discount rate in the upcoming meeting of the monetary policy committee scheduled this month.

The soared by 1.24 per cent to 104,559.07 points against 103,274.95 points recorded in the last session. The highest index of the day remained at 104,680.89 points while the lowest level was recorded at 102,825.6 points.

Ahsan Mehanti, an analyst at Arif Habib Corp, said, “Stocks closed bullish, led by scrips across the board, as investors eye a big policy rate cut next week after CPI inflation fell to six-year lows.”

He said upbeat data on the $8.65 billion trade deficit narrowing by 7.4 per cent; $13.69 billion exports up by 12.57 per cent for July Nov’24 and rupee stability was a catalyst in the record surge at the PSX.The KSE-30 index increased by 396.53 points or 1.24 per cent to 32,365.89 points against 31,969.36 points.

Traded shares increased by 210 million shares to 1,766.474 million shares from 1,556.252 million shares. The trading value rose to Rs56.624 billion from Rs47.097 billion. Market capital expanded to Rs13.252 trillion against Rs13.107 trillion. Of the 465 companies active in the session, 271 closed in green, 160 in red and 34 remained unchanged.

Analyst Maaz Mulla at Topline Securities said the bulls firmly took charge as the KSE-100 index soared, reaching remarkable new milestones. “The trade value in the ready market climbed to an impressive Rs57 billion ($203 million), marking the highest level in 18 years,” he said. “This bullish momentum is largely attributed to heightened investor optimism surrounding a potential substantial rate cut in the upcoming monetary policy meeting scheduled for December 16, 2024.”

Adding to the positive sentiment, Pakistan’s trade deficit for November 2024 contracted by 19 per cent year-on-year to $1.59 billion, supported by a rise in exports and a decline in imports. “This improvement has bolstered expectations of a robust current account surplus, further uplifting market confidence,” he said.

Key drivers of the index’s rally included heavyweights such as Engro, MARI, POL, FFC, and DAWH, collectively contributing 658 points. On contrast, HBL, SYS, MEBL, CHCC, and PPL trimmed 169 points from the index.

The highest increase was recorded in Unilever Pakistan Foods Limited, which rose by Rs65.10 to Rs19,865.11 per share, followed by Neslte Pakistan Limited, which increased by Rs48.51 to Rs6,681.38 per share. A significant decline was noted in Hafiz Limited, which fell by Rs21.31 to Rs262.50 per share; Indus Motor Company Limited followed it, which closed lower by Rs20.65 to Rs2,005.94 per share.

Cnergyico PK remained the volume leader with 246.707 million shares which closed higher by Re1 Rs6.72 per share. WorldCall Telecom with 89.419 million shares followed it, which closed higher by one paisa to Rs1.47 per share.

Other significant turnover stocks included Hascol Petrol, Pak Elektron, Sui South Gas, Power Cement, K-Electric Ltd, Pak Int Bulk, Pak Refinery and Symmetry Group Ltd. In the futures market, 306 companies recorded trading, 226 of which increased, 76 decreased, and 4 remained unchanged.