Pakistan stock market posts largest annual gain since 2003

The Pakistan Stock Exchange (PSX) has reported its most impressive annual return in over twenty years, driven by optimism over improved economic conditions, attractive valuations, and a shift to monetary easing by the central bank.

The KSE-100 Index surged by 89.2 per cent, adding 36,992 points to reach 78,444.9 in the fiscal year ending June 2024. This represents the largest yearly gain since FY 2003. In USD terms, the index rose by 94.4 per cent, the highest increase since FY 2003.

According to Mettis Global, this historic bull run commenced when Pakistan narrowly avoided a sovereign debt default, thanks to a rescue package from the International Monetary Fund (IMF) towards the end of the last fiscal year.

The IMF’s $3 billion loan programme also facilitated additional multilateral and bilateral funding, boosting the country’s foreign exchange reserves by 99 per cent to $8.9 billion.

The benchmark index reached its first record high in seven years in November 2023 and continued to set new highs throughout the year without significant pullbacks.

Market participation remained robust in FY24, with the average traded volume on the PSX surging by 140 per cent to 272.5 million shares.

Traded value in PKR terms increased by 154 per cent to 15.6 billion. In USD terms, the volume was recorded at $55.2 million, a gain of 118 per cent compared to the previous year.

The strong performance of the PSX reflects investor confidence in Pakistan’s economic recovery and the positive impact of the IMF’s support programme.