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Sunday May 19, 2024

PSX tops 70,000 points driven by Saudi $5bn pledge, IMF hopes

Benchmark KSE-100 index gains 694.73 points or 1% to settle at 70,314.71 points by the closing bell

By Web Desk
April 09, 2024
A person can be seen in the Pakistan Stock Exchange (PSX) in this undated photo. —AFP/FIle
A person can be seen in the Pakistan Stock Exchange (PSX) in this undated photo. —AFP/FIle

KARACHI: The Pakistan Stock Exchange (PSX) breached the key psychological barrier of 70,000 points to hit another all-time high, driven by Saudi Arabia’s renewed pledge to rush its $5 billion investment package and International Monetary Fund deal hopes, traders said.

The benchmark KSE-100 index gained 694.73 points or 1% during the intraday trading to reach 70,314.71 points, up from the previous close of 69,619.98 points.

Saudi Arabia pledged to accelerate the first instalment of a $5 billion investment in Pakistan, with Islamabad vowing to streamline the process to bolster economic cooperation between the two nations.

This commitment was made during a meeting between Saudi Crown Prince Mohammed bin Salman and Prime Minister Shehbaz Sharif in Makkah on Sunday night.

The prime minister was on a three-day visit to seek economic assistance from the kingdom.

Mohammed Sohail, CEO of Topline Securities, in a post-market note, said the stock market crossed the 70,000 mark amid positive news on Saudi investment and deposits.

“Continuous foreign buying [is] also helping equities. KSE-100 is now up almost 70% from June end,” he added.

Samiullah Tariq, head of research at Pak-Kuwait Investment Company, told Geo.tv that the market is hopeful of a new IMF deal.

He also attributed the gain to high remittances and expectations of good company results to be announced for the March end quarter.

JS Research in a note said bulls maintained their control over the session, with the KSE-100 index concluding at 69,620, marking an increase of 1,203 points. Trading volume, however, decreased to 336 million shares from the previous session's 389 million shares.

“Should the upward momentum persist, the anticipated target could reach 70,201, potentially extending further to the 71,262 level,” the brokerage said.

The JS report said that any downward movement was expected to find support within the range of 68,980 to 69,350 levels; a breach below this range might signal the beginning of a corrective trend.

The rupee maintained its stability against the US dollar in the inter-bank market on Tuesday. By close of trading, the local currency settled at 277.94, marking a marginal gain of Re0.01 against the greenback, as reported by the State Bank of Pakistan.

Remittances sent home by overseas workers have surged 31.27% month-on-month to $2.95 billion in March, compared to $2.25 billion in the previous month, the latest data issued by State Bank of Pakistan (SBP) revealed on Monday.

This significant increase in the remittances can largely be attributed to Ramadan inflows, which traditionally witnesses a surge because expats send extra money home for the Eid expenses.

Arif Habib Limited (AHL) in a note said remittances increased by 16% year-on-year to $3 billion — highest monthly inflows after April 2022 — during March 2024 compared to $2.5 billion in March 2023.