The Karachi Stock Exchange (KSE 100 index) continued its rally on May 13, rising for the third session in a row and also inching closer to its all-time high. In the intraday trading session today, the stock surged 2.16%.
This bullish mood comes just days after a steep drop caused by ongoing tension between India-Pakistan. But as of now it looks like investors are breathing easy, due to the signs of de-escalation between India and Pakistan. Furthermore, another reason for the rally is the financial boost from the International Monetary Fund (IMF).
Ceasefire and cash
The Pakistan stock exchange began soaring after news of a ceasefire agreement between India and Pakistan. This in a way is a major geopolitical relief for both markets and investors.
But that was not the only reason for the stock rally in the Pakistan stock exchange. The IMF also came through for Pakistan, completing its first review of the country’s economic reform program and approving disbursements worth over $2 billion, including a fresh $1.4 billion under the Resilience and Sustainability Facility.
These developments acted like a fuel for the KSE 100, pushing the index up by more than 15% in just three trading sessions. On May 13 alone, it gained over 2% to touch an intraday high of 119,828, just short of its all-time peak of 120,796.
From panic to party in just a week
Only a few days ago, the mood on the street was bleak. Looking at the numbers, in just 4 days, the stock had tumbled by nearly 16% due to fears of a possible escalation between the two nations.
But the narrative flipped quickly after the announcement of Operation Sindoor’s halt and IMF’s support.