PSX surges to all-time high, breaches 85,000 milestone

Bulls continued their stampede on the trade floor as shares at the Pakistan Stock Exchange (PSX) breached a new record of 85,000 in intraday trade on Monday.

The benchmark KSE-100 index climbed 712.77 points, or 0.85 per cent, to stand at 84,244.72 from the previous close of 83,531.95 points at 12:21pm. Finally, the index closed 84,910.29 points, up by 1378.34 points or 1.65pc, from the previous close.

Yousuf M Farooq, director research at Chase Securities, said, “Falling yields have spurred increased interest in the stock market, as lower fixed-income returns have driven investors to seek higher yields in equities.”

Additionally, he highlighted that “a quarter-on-quarter decline in receivables” for companies such as Pakistan Petroleum Limited (PPL) and Pakistan State Oil (PSO) attracted attention to the oil and gas sector.

“This search for better returns has caused the market to largely overlook last nights security incident in Karachi and political instability in Islamabad,” he added.

Late on Sunday night, a massive explosion occurred on a road near Jinnah International Airport, killing a total of three people and injuring at least 11 others, including a Chinese citizen.

Awais Ashraf, director research at AKD Securities, attributed the climb to “a substantial decline in fixed income market yields, coupled with the positive impact of energy tariff rationalisation on the financial standing of energy sector stocks”.

“Stocks offering higher dividend yields and benefiting from structural reforms contributed the most to today’s gains in the index,” he added.

He highlighted that energy sector stocks such as Oil and Gas Development Company (OGDC), PPL, PSO and Sui Northern Gas Pipelines Limited (SNGP) “saw gains due to improved cash flows following the tariff adjustments”.