ISLAMABAD: The KSE-100 index of the Pakistan Stock Exchange (PSX) recorded an impressive 85% gain in Pakistani rupees and 87% in US dollars during 2024, a report by the country’s top brokerage house said this week, listing pharmaceuticals, jute and transport among the top-performing sectors of the market.
Pakistan’s stock market has enjoyed gains and bullish trends since the past two months. Financial analysts have attributed the stock market’s bullish trend to drastic cuts in key policy rate, strengthening of the rupee and economic gains triggered by Islamabad signing a $7 billion loan with the International Monetary Fund (IMF) this year.
Pakistan’s central bank cut its key policy rate by 200 basis points to 13% on Dec. 16, making it the fifth straight reduction since June, as the country keeps up efforts to revive a sluggish economy with inflation on the decline as per official figures.
According to a yearly market review by Topline Securities on Tuesday, the market capitalization of companies listed at the Pakistan Stock Exchange (PSX) increased by 61% to reach Rs14.6 trillion this year.
“Benchmark KSE 100 Index jumped 85% in PKR (87% in USD) in 2024, with only one trading session left,” the report said. “Market value (market capitalization) of listed companies at PSX also increased by 61% to reach Rs14.6trn.”
The report pointed out that pharmaceuticals, jute and transport were the best performing sectors in 2024 as their market cap increased by 198%, 182% and 130% respectively. On the other hand, chemicals, modarabas, and textile weaving sectors remained the worst performing sectors that posted declines of 54%, 33% and 2%, respectively in 2024.
Raza Jafri, the head of equity at Intermarket Securities, told Arab News that the gains enjoyed by the PSX made it one of the “best-performing equity markets in the world.”
He highlighted that the Pakistan stock market’s gains outpaced those of the Morgan Stanley Capital International Emerging Markets Index and the Morgan Stanley Capital International Frontier Markets Index, which gained only around five percent in 2024.
“Macro stabilization, which reflected in sharp interest rate cuts and a stable Pakistani rupee, enabled equity market valuations in Pakistan to bounce back from record lows,” Jafri told Arab News on Wednesday.
Meanwhile, Arif Habib Commodities CEO Ahsan Mehanti said the PSX outperformed other stock markets due to the central bank’s key policy rate, robust economic indicators and the successful disbursement of the new IMF program.
“Government bond yields fell by over an unprecedented 1100bps during the year inviting institutional interest in equities,” he said. “Fall in global crude oil prices reduced import bill by up to $5 billion and helped CPI inflation to fall below five percent resulting in current account surplus and rupee stability.”
According to Topline Securities, the best-performing stocks in Pakistan were GlaxoSmithKline Pakistan (GLAXO), which recorded a 385% increase; Air Link Communication (AIRLINK), which gained 268%; Sazgar Engineering (SAZEW), which gained 252 percent; Fauji Fertilizer Company (FFC), which rose 246 percent; and Mari Petroleum Company (MARI), which gained 220 percent.
It added that the top performers among all listed stocks in 2024 were Ali Asghar Textile Mills (AATM), which gained 2,774%; Khalid Siraj Textile Mills (KSTM), which rose by 1,156%, Thatta Cement Company (THCCL), whose share price soared by 1,027%; and Dewan Automotive Engineering (DWAE), which surged by 1,073%.
Pakistan’s Prime Minister Shehbaz Sharif also expressed his happiness over the Pakistani stock market’s performance in a post on social media platform X.
“Alhamdolilah! What great news to end the year on!” he wrote on Wednesday.
