KARACHI: In a short week after the Eid holiday, the stock market reached a new peak on optimism that the tax-laden budget 2024-25 has paved the way for securing another bailout package from the International Monetary Fund.

Arif Habib Ltd (AHL) said during the two-day trading week, the market sustained its positive momentum, surging from 76,707 points to 78,810 points, closing at an all-time high.

Investors remained optimistic amid expectations of the new IMF programme, decelerating inflation, favourable interest rate trajectory, and the shift of funds from fixed income to equities.

Moreover, on Friday, the market cap reached a historic level of Rs10.55 trillion, surpassing the previous high of Rs10.45tr set in May 2017. Additionally, the State Bank of Pakistan’s exchange reserves increased by $31m week-on-week to $9.1bn. Furthermore, the rupee remained stable against the dollar at Rs278.5.

As a result, the index settled at 78,810 points, marking a significant increase of 2,104 points or 2.74pc week-on-week.

Sector-wise, positive contributions came from commercial banks (1,486 points), power generation and distribution (409 points), fertiliser (151 points), chemicals (76 points), and textiles (55 points).

Meanwhile, the sectors that mainly contributed negatively were cement (89 points), technology and communication (67 points), and oil marketing companies (41 points).

Foreign buying was witnessed during the week, clocking in at $0.6m compared to a net sell of $5.8m last week.

The average trading volume rose 2.8pc to 462m shares while the average value traded jumped 21.8pc to settle at $74m week-on-week.

According to AHL, developments related to the IMF will further improve market sentiment in the coming week. Furthermore, scrips are currently trading at attractive valuations, which could entice investors.

Published in Dawn, June 23rd, 2024