The Pakistan Stock Exchange (PSX) saw a surge on Thursday with shares gaining over 700 points, driven by falling bond yields. The benchmark KSE-100 index rose by 754.76 points, closing at 82,721.76, up by 0.92%. This bullish trend was attributed to lower bond yields making equities more appealing, especially high dividend yielding stocks.
Experts like Raza Jafri and Mohammed Sohail credited the momentum to decreasing yields in the money market, prompting increased investor interest. Sana Tawfik noted that improving liquidity and a lower-than-expected inflation rate also contributed to the market sentiment. The recent rejection of bids for treasury bills but raising close to the target amount indicated a positive shift in the local money market.
Despite foreign investor selling, expectations of a policy rate cut and the injection of liquidity by the State Bank of Pakistan have propelled the stock market. The rejection of bills at the recent auction caused yields to plummet, fueling optimism for future rate cuts.