Shares at the Pakistan Stock Exchange’s benchmark index gained nearly 4,000 points as the world heads to the new year and hopes for a further decline in interest rates.

According to the PSX website, the KSE-100 index gained 3,907.82 more points, a positive change of 3.51 per cent, to close at 115,259.00 points as compared to 111,351.18 points on the last trading day.

“This upward momentum was fuelled by optimism surrounding anticipated increases in equity fund allocations by local institutions ahead of the new year,” the Topline Securities said in a statement.

The firm added that the finance minister’s statement over the weekend, suggesting a potential decline in interest rates to single-digit levels in the future added further “impetus” to the shares. “While the ultimate decisions lie with the Monetary Policy Committee, the minister’s remarks boosted market confidence and optimism about the economic outlook.”

A total of 1,059,020,119 shares were traded during the day as compared to 815,920,043 shares the previous trading day, whereas the price of shares stood at Rs40.889 billion against Rs32.917 billion on the last trading day.

As many as 465 companies transacted their shares in the stock market, 333 of them recorded gains and 84 sustained losses, whereas the share price of 48 companies remained unchanged.

The three top trading companies were Cnergyico PK with 125,613,935 shares at Rs7.44 per share, WorldCall Telecom with 111,551,930 shares at Rs1.83 per share and Bank of Punjab with 84,182,656 shares at Rs10.47 per share.

PSX emerges as top performer

According to a report by Topline Securities, the PSX has emerged as the top performer among Pakistan’s asset classes in 2024, with the KSE-100 Index climbing 78%. This impressive performance positions it as the second-best performing market globally, trailing only Argentina. Over the past 18 months, the PSX has delivered a remarkable 177% return in USD (169% in PKR), attributed to macroeconomic stabilization and improvements in external accounts.

Despite the rally, the market capitalization of the PSX remains at $50 billion, half of its peak of $100 billion reached in 2017. The report attributes this decline to PKR devaluation, substantial dividend payouts, and fewer listings.

Last week also saw a bullish trend in the PSX, closing on a positive note with gains driven by fresh buying at attractive low levels. The benchmark KSE-100 Index rose by 1,838.03 points week-on-week, ending at 111,351.18 points.

On the global front, Asian shares traded lower on Monday as high Treasury yields posed challenges to elevated Wall Street valuations, keeping the US dollar near multi-month highs. Trading volumes were light ahead of the New Year holiday, with China set to release PMI factory surveys on Tuesday and the US ISM survey for December expected on Friday.

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MSCI’s broadest index of Asia-Pacific shares outside Japan dipped 0.2%, although it remains 16% higher for the year. Japan’s Nikkei eased by 0.2% but has still gained 20% in 2024. In contrast, South Korea’s main index faced political uncertainty, resulting in losses exceeding 9% for the year, and was down 0.35% in recent trading.

S&P 500 and Nasdaq futures both fell by 0.1% as Wall Street experienced a broad sell-off on Friday, with no clear trigger noted, although trading volumes were just two-thirds of the daily average.