New record-high at PSX as KSE-100 zooms past 121,000
Buying rally continued at the Pakistan Stock Exchange (PSX) on Wednesday amid reports that talks with the International Monetary Fund (IMF) over the incoming federal budget had been successful, with the benchmark KSE-100 Index settling at a new record high.
Positive momentum was observed throughout the trading session, pushing the benchmark index to an intra-day high of 121,882.47.
At close, the benchmark index settled at 121,798.86, an increase of 1,347.99 points or 1.12%.
'Valuations have become attractive, which is driving the current buying momentum,' said Sana Tawfik, Head of Research at Arif Habib Limited (AHL), while speaking to Business Recorder.
On Tuesday, PSX closed at a new all-time high level, driven by positive expectations from the upcoming budget and news of the Asian Development Bank's (ADB) approval of $800 million for Pakistan.
The benchmark KSE-100 Index jumped 1,573.07 points or 1.32% to close at 120,451 points, crossing the 120,000-point mark for the first time on a closing basis.
Internationally, Asian stocks inched higher on Wednesday and the dollar wobbled near six-week lows as traders braced for higher US duties on steel and aluminium, the latest chapter in the trade war saga that has rattled the markets for much of the year.
South Korea's stocks and its currency surged as liberal presidential candidate Lee Jae-myung's election victory raised hopes of swift economic stimulus, market reforms and easing policy uncertainty.
The benchmark KOSP jumped more than 2% to its highest since August 2024.
That left the MSCI's broadest index of Asia-Pacific shares outside Japan 0.6% higher.
Japan's Nikkei rose 0.8%, while Taiwan stocks jumped 1.6% after artificial intelligence behemoth Nvidia boosted US stocks overnight.
Data on Wednesday showed US job openings increased in April, but layoffs picked up, indicating a slowing labour market as tariffs impact the economic outlook.
Investor attention has been on a possible call between US President Donald Trump and Chinese leader Xi Jinping sometime this week as tensions between the world's top two economies simmer.
Trump on Friday accused China of violating a Geneva agreement to roll back tariffs and trade restrictions.
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Express Tribune
a day ago
- Express Tribune
PSX makes history on macro boost
Listen to article The Pakistan Stock Exchange (PSX) sustained its bullish streak in the outgoing week, with the benchmark KSE-100 index surging to an all-time high of 121,798 points on June 4, before settling at 121,641, marking a weekly gain of 1,950 points (+1.63%). The rally was fueled by renewed investor confidence following successful budget talks with the International Monetary Fund (IMF), the Asian Development Bank's (ADB) approval of a $800 million financing package and the government's finalisation of a Rs1.275 trillion circular debt resolution deal with banks – a significant development for the energy sector. Macroeconomic indicators further supported sentiment as petroleum sales jumped 10% year-on-year (YoY) in May 2025, the Consumer Price Index (CPI)-based inflation eased to 3.5% and the trade deficit narrowed 23% month-on-month (MoM). However, the State Bank's reserves dipped slightly by $7 million, settling at $11.5 billion. On a day-on-day basis, the PSX attempted once again on Monday to decisively breach the key psychological barrier of 120,000 at close but fell short, ending the session at 118,878, reflecting a decline of 813 points. It came due to profit-taking pressure at record levels. On Tuesday, the market soared to an all-time high above 120,000 points as investor optimism grew following the approval of a $800 million loan by the ADB for Pakistan's public finance programme and the government's approval of a Rs880 billion Public Sector Development Programme (PSDP). The benchmark KSE-100 index recorded an increase of 1,573 points and settled at 120,451. The bourse continued its record-breaking run on Wednesday, with the index closing at an all-time high of 121,799, up 1,348 points. Investor sentiment remained upbeat ahead of the federal budget, buoyed by expectations of fiscal relief measures and encouraging macroeconomic indicators. However, the PSX witnessed a volatile session on Thursday, with the benchmark index retreating after hitting record highs a day earlier. Investor sentiment turned cautious due to concerns about stringent conditions linked to a new IMF programme, including the proposed enforcement of agriculture income tax and the IMF's opposition to provincial energy subsidies. The PSX ended the day on a negative note at 121,641, down 158 points. "Building on last week's bullish trend, the market picked up pace, with the KSE-100 reaching an all-time high of 121,798 points on June 4, driven by buying interest across different sectors," Arif Habib Limited (AHL) wrote in its weekly report. Positive sentiment followed Pakistan's successful budget talks with the IMF, alongside the ADB's approval of a $800 million financing package. The government also finalised a Rs1.275 trillion circular debt resolution deal with banks, a significant move for the power sector, AHL said. Meanwhile, during May 2025, petroleum sales rose 10% YoY, inflation came in at 3.5% and the trade deficit narrowed 23% MoM. The State Bank's reserves declined $7 million to $11.5 billion. The market closed at 121,641, depicting a surge of 1,950 points, or 1.63% week-on-week (WoW). Sector-wise, the positive contribution came from commercial banks (1,044 points), power generation and distribution (369 points), fertiliser (206 points), food and personal care products (95 points) and chemicals (60 points). Meanwhile, the sectors that contributed negatively were technology and communication (82 points), automobile assemblers (29 points), miscellaneous (24 points), cable and electrical goods (10 points) and Real Estate Investment Trusts (five points). Scrip-wise, the positive contributors were Pakgen Power (327 points), Bank AL Habib (208 points), NBP (165 points), HBL (160 points) and Fauji Fertiliser Company (158 points). Foreigners' selling was witnessed during the week, which came in at $14.7 million compared to net selling of $5.56 million last week. Average volumes arrived at 660 million shares (-0.2% WoW) while average traded value settled at $98.6 million (up 24.9%), AHL added. Syed Danyal Hussain of JS Global wrote that the KSE-100 index hit an all-time high during the outgoing week, closing at a record level of 121,641 points, up 1.6% WoW. The rally was largely driven by optimism surrounding a potential agreement with the IMF, as indicated by the prime minister, which spurred pre-budget sentiment, he said. The government, following the IMF's endorsement, finalised a Rs1.275 trillion financing agreement with 18 commercial banks to address the power sector's circular debt. On the sectoral front, local cement dispatches rose 9% YoY in May 2025, bringing 11MFY25 volumes to nearly flat levels. Meanwhile, a 26% rise in exports during 11MFY25 lifted total cement sales to a growth of 2%, he added.
Business Recorder
a day ago
- Business Recorder
Power tariff hike: Govt reaches ‘understanding' with IMF
ISLAMABAD: The government and the International Monetary Fund (IMF) have reportedly reached an understanding that electricity tariffs will be increased through annual rebasing from July 2025 if the power sector's revenue requirements exceed the allocated subsidy envelope of Rs 1.036 trillion for fiscal year 2025–26, well-informed sources in the Finance Ministry told Business Recorder. This understanding was reached during discussions between Pakistani authorities and the visiting IMF mission held from May 14 to 24, 2025. 'Within the Rs 1.036 trillion envelope, sufficient subsidy will be allocated to ensure zero circular debt flow in FY26. The Petroleum Development Levy (PDL)-financed Prime Minister's package—amounting to Rs 182 billion—will be counted toward the FY26 subsidy,' the sources added. Reduced hydropower, costly fuels: Govt warns of potential hike in power bills Both sides also agreed that any additional financial needs will be met through tariff adjustments during the July rebasing exercise while maintaining a progressive power tariff structure, the sources maintained. According to sources, the IMF emphasized the importance of fiscal discipline, with subsidy levels expected to remain within 0.8% of GDP. These subsidies will be linked to credible targets for stock clearance and loss reduction. The Power Division has been directed to take all necessary steps to implement the measures agreed upon with the IMF. The government had earmarked Rs 1.190 trillion for the power sector for FY2024–26. However, the Power Division has also secured approval for additional subsidies to keep the circular debt flow within the limit agreed with the Fund. The Finance Division has revised and communicated provisional Indicative Budget Ceilings (IBCs), allocating Rs 636.136 billion for sector subsidies under the recurrent budget for FY2025–26, up from the earlier allocation of Rs 400 billion. As the detailed breakdown of the revised subsidy for FY2024–25 is not available, it remains unclear whether the full allocation has been utilized by the Power Division or if deviations occurred. Sources within the Power Division believe that subsidies for FY2025 may exceed Rs 1.2 trillion, driven by growing support for residential consumers and persistent circular debt obligations. 'A sharp increase in protected consumer categories—those consuming less than 200 units per month—is driving higher subsidy needs, as more consumers adjust their consumption or install solar panels to stay within the protected threshold,' the sources said. Cross-subsidy pressures are also rising, as declining industrial and commercial consumption reduces the contribution of higher-paying users to the overall system. The government also plans to clear up to Rs 541 billion in circular debt stock during FY2025, as part of a broader six-year debt reduction strategy. 'Subsidy allocations remain a contentious issue, particularly concerning the treatment of PDL proceeds and their role in budget financing,' the sources continued. Tariff rebasing and further adjustments remain under government consideration to close the subsidy gap. However, political sensitivities and lobbying from industrial stakeholders are limiting policy flexibility. The successful implementation of the Circular Debt Workout and Action Plan (CDWAP) and the ongoing restructuring of Pakistan Holding Limited's (PHL) debt are seen as critical to reducing future interest costs and stabilizing circular debt flows. Additionally, the Finance Division has directed the Power Division to strictly follow mandatory instructions issued to all Principal Accounting Officers (PAOs), heads of departments, and related entities when preparing budget estimates for each cost center and account head. Copyright Business Recorder, 2025
Business Recorder
a day ago
- Business Recorder
Japan's Nikkei rises on weaker yen
TOKYO: Japan's Nikkei share average rose on Friday, as a weaker yen lifted sentiment, while concerns about trade tensions eased following a phone call between US President Donald Trump and Chinese President Xi Jinping. The Nikkei rose 0.5% to 37,741.61 but fell 1% for the week. The broader Topix climbed 0.47% to 2,769.33 while posting a 1.6% weekly loss. 'The trade talks seemed to have ended peacefully and that sent a positive sign to the market,' said Naoki Fujiwara, senior fund manager at Shinkin Asset Management. On Thursday, Trump held a long-awaited phone call with Xi Jinping, in an effort to resolve trade disputes between the world's two largest economies that have buffeted the global economy, and agreed to hold further discussions. But caution ahead of the US non-farm payrolls report, due later in the day, capped gains, Fujiwara said. The Nikkei got technical support ahead of the fixing of special quotation prices, used to set values on index options and futures, next week, said Seiichi Suzuki, chief equity market analyst at Tokai Tokyo Intelligence Laboratory. 'Foreigners, who shorted the Nikkei futures, bought them back ahead of the fixing day, which also lifted the Nikkei index.' The yen, which last traded down 0.3% at 144 per dollar, also supported local equities, Shigetoshi Kamada, general manager at the research department of Tachibana Securities, said. Chip-related heavyweights Tokyo Electron and Advantest rose 1.28% and 2.23%, respectively.
