KSE-100 touches new high and rupee appreciates on IMF progress and UAE investment commitment

 

The KSE-100 index touched a new all-time high on Friday, closing just shy of the 76,000 mark, as positive sentiment boosted Pakistan's stock market. Investors were cheered by news of significant progress in talks between Pakistan authorities and the IMF mission towards reaching a staff-level agreement on a new Extended Fund Facility program. A longer IMF program is expected to support Pakistan's economic reforms and stabilization goals. Adding to the positive mood, the United Arab Emirates pledged $10 billion for investment in key sectors in Pakistan following meetings between the two countries' leaders. This major commitment from the UAE was welcomed by market participants as a strong vote of confidence in Pakistan's economy.

Along with the benchmark index hitting a record level, the Pakistani rupee also appreciated marginally against the US dollar. The local currency closed at 278.21 per dollar on Friday, gaining 0.03% over the previous close. A smaller current account deficit and recovering foreign exchange reserves have brought some stability to the currency market recently after volatility earlier in the fiscal year. The progress in IMF discussions and substantial UAE investment pledge reinforced beliefs that Pakistan's economic conditions and policies are moving in the right direction to promote stability and growth. 

Sector-wise, oil and gas exploration, banking, and cement stocks were among the strongest gainers and led the bullish charge on the KSE-100. Higher trading volumes compared to the previous session indicated increased participation by institutional and individual investors. The positive news on external financing fronts boosted confidence in the market at a time when economic recovery has been underway on the back of measures like controlled inflation and fiscal consolidation efforts over the past year.