PSX continues upward march on improved economic sentiment

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  Brokers are busy in trading at Pakistan Stock Exchange （PSX） in Karachi on Wednesday, October 23, 2024. — PPI

The Pakistan Stock Exchange （PSX） extended its upward momentum on Tuesday amid growing investor confidence following Pakistan\“s staff-level agreement （SLA） with the International Monetary Fund （IMF）.

Market optimism was further supported by expectations of strong upcoming corporate results and anticipated investments from Saudi Arabia.

During intraday trading, the benchmark KSE-100 Index reached an intraday high of 168,197.47, gaining 2,171.23, or 1.31%, from the previous close of 166,242.90 points. It touched a low of 166,923.59 points, still up 680.69 points, or 0.41%.

Market expert and CEO of Ismail Iqbal Securities, Ahfaz Mustafa, attributed the bullish sentiment to a mix of macroeconomic and corporate factors. “The successful SLA, the upcoming result season, and the first sell-off of a state-owned enterprise — the First Women Bank — are fueling positive sentiments,” he said.

“Talks about investments from Saudi Arabia and the current account surplus are also adding to the optimism,” he added.

Pakistan’s current account returned to a surplus in September as the trade deficit narrowed, providing temporary relief to the country’s external finances.

The current account posted a surplus of $110 million in September, compared with the deficit of $325 million in the previous month and the $52 million shortfall in September 2024, according to State Bank of Pakistan data released on Monday.

However, in the first quarter of the fiscal year 2026, the nation’s current account deficit increased by 18% to $594 million. In September, the current account balance reported a surprising surplus that caught analysts and markets off guard, as expectations were for a deficit. The last time a surplus was recorded in June.

Saad Hanif, head of research at Ismail Iqbal Securities, said that the surplus was a significant upside surprise compared with industry expectations of a deficit ranging from $400 million to $500 million.

“The divergence likely stems from timing and accounting adjustments between customs and balance of payments reporting,“ Hanif said.“This positive surprise could provide temporary support,” he added.