PSX rallies as Saudi Arabia deposits $2bn, KSE-100 gains nearly 1,400 points

Buying rally continued at the Pakistan Stock Exchange (PSX), with the benchmark KSE 100 Index gaining nearly 1,400 points on Thursday.

The State Bank of Pakistan’s early morning announcement confirming the receipt of $2 billion from Saudi Arabia and optimism over a potential resumption of US–Iran negotiations lifted investor sentiment at the bourse, pushing the index to an intra-day high of 170,899.16.

At close, the benchmark index settled at 169,911.95, up by 1,392.01 points or 0.83%.

“The local bourse sustained its bullish trajectory, with sentiment firmly anchored in optimism over a potential resumption of US–Iran negotiations following earlier inconclusive talks. The easing of geopolitical overhang continued to trigger a risk-on rally, with investors aggressively rebuilding positions across the board,” Topline Securities said in its post-market report.

On the index front, key heavyweights including UBL, OGDC, HUBC, PPL, ENGROH, and FFC collectively contributed 1,013 points to the benchmark’s advance, underscoring the index-heavy nature of the rally and sustained institutional flow into blue chips, Topline said.

On Wednesday, the KSE-100 Index gained 2,885.10 points or 1.74% to close at 168,519.94 points.

On Wednesday, Finance Minister Muhammad Aurangzeb informed that the Kingdom of Saudi Arabia had committed $3 billion in additional deposits, with disbursement expected in the coming week. He further stated that the existing $5 billion Saudi deposit would no longer remain subject to the earlier annual rollover arrangement and would instead be extended for three years.

Pakistani officials are anticipating a “major breakthrough” in negotiations between Iran and the United States regarding Tehran’s nuclear programme, Al Jazeera reported citing sources, as Islamabad intensifies diplomatic efforts to resolve the Middle East conflict that has claimed thousands of lives.

The optimism on Wednesday followed the arrival of a high-level Pakistani delegation in Iran, led by Chief of Defence Forces Field Marshal Syed Asim Munir. According to Iran’s Press TV, the delegation’s mission is to deliver a strategic message from Washington to the Iranian leadership.

Internationally, stocks pushed higher in early Asia trading on Thursday as optimism grew about a deal to end the Iran ​war with the US ratcheting up pressure on Tehran, while ‌traders prepared for a raft of economic data and critical earnings reports.

MSCI’s broadest index of Asia-Pacific shares outside Japan was up 0.3%, putting the benchmark on ​track for a third consecutive day of gains, while Japan’s ​Nikkei rose 1.5%. S&P 500 e-mini futures nudged 0.1% higher.

Overnight, ⁠the S&P 500 was up 0.8% and the Nasdaq Composite gained ​1.6%, as strong quarterly earnings from Bank of America and Morgan Stanley ​lifted the indexes to record highs. With around 6% of companies reporting earnings for the quarter, 84% have beaten analysts’ expectations.

Meanwhile, the Pakistani rupee registered marginal gain against the US dollar in the inter-bank market on Thursday. At close, the local currency settled at 278.95 against the greenback.

Volume on the all-share index dropped to 972.71 million from 1,205.84 million recorded in the previous close.

The value of shares decreased to Rs43.93 billion from Rs59.42 billion in the previous session.

Unity Foods Ltd was the volume leader with 70.58 million shares, followed by K-Electric Ltd with 53.10 million shares, and Hascol Petrol with 46.29 million shares.

Shares of 489 companies were traded on Thursday, of which 307 registered an increase, 139 recorded a fall, and 43 remained unchanged.