The stock market regained its bullish momentum on Thursday, reversing the losses of the previous session as investors reacted favorably to a series of positive economic developments. These included Fitch’s credit rating upgrade for Pakistan and a significant drop in global oil prices.
The Pakistan Stock Exchange’s (PSX) benchmark KSE-100 Index concluded the trading day at 116,901.13, marking an increase of 881.03 points, or 0.76%, compared to the previous closing figure of 116,020.10.
During the trading session, the index reached an intraday peak of 117,216.02, representing a gain of 1,195.92 points, or 1.03%. The lowest point of the session was recorded at 115,818.07, showing a modest dip of 202.03 points, or 0.17%.
“Markets are responding positively to various pieces of news, including the recent upgrade from Fitch Ratings, the progress in resolving circular debt issues, and a notable decline in oil prices,” commented Ahfaz Mustafa, the CEO of Ismail Iqbal Securities.
He further elaborated, “The decrease in oil prices and the anticipation of lower inflation, combined with the tax relief announced for real estate transactions, are all contributing to the current positive sentiment in the market.”
Investor confidence received a boost from Fitch Ratings’ decision earlier in the week to upgrade Pakistan’s long-term foreign-currency issuer default rating to ‘B-’ from ‘CCC+’, while also assigning a stable outlook. The agency cited improvements in fiscal consolidation, a more stable external account, and stronger macroeconomic management under the ongoing International Monetary Fund (IMF) programme as key factors for the upgrade.
Macroeconomic sentiment was further bolstered by the consumer price index data for March, which indicated that inflation had slowed to 0.69%, the lowest monthly reading in over seven years.
Adding to the positive economic indicators, the government successfully raised a substantial Rs965 billion through the auction of Market Treasury Bills (T-bills) on Wednesday, surpassing its initial target of Rs850 billion.
Cut-off yields experienced a slight decrease for one-month and six-month tenors, while remaining unchanged for other durations. Additionally, the government raised Rs261 billion through Pakistan Investment Bonds (floaters) against a target of Rs400 billion.
Earlier in the week, the Governor of the State Bank of Pakistan (SBP), Jameel Ahmad, expressed optimism that the recent decline in oil prices would help to mitigate the impact of reciprocal tariffs imposed by the United States.
Last week, US President Donald Trump announced a 90-day pause on any new tariff measures, providing an opportunity for negotiations after previously imposing 29% duties on goods exported from Pakistan.
It’s worth noting that prior to this positive rebound, the PSX had ended its two-day winning streak on Wednesday, falling by 755.4 points or 0.65% to close at 116,020.11.
