Pakistan Stock Market Hits Record High of 100,000 Points: Experts Attribute Success to Government Decisions and IMF Program
Islamabad:The Pakistan Stock Exchange (PSX) has witnessed a remarkable surge over the past year, with the index rising by nearly 37,000 points, marking the highest annual increase in its history. From hovering around 40,000 points up until 2022, the PSX has now surpassed the 100,000-point mark in November 2024, a milestone that reflects a stunning two-year growth of 60,000 points.
Experts attribute this exceptional performance to several key factors, including tough government decisions and the successful revival of the International Monetary Fund (IMF) program. The significant rise in the stock market is being seen as a positive signal for Pakistan’s economic performance, despite ongoing challenges in other sectors.
**Government’s Role in Stock Market Success**
Economic expert Muhammad Adnan Parcha emphasized that the government deserves credit for the stock market’s success. He said, “The stock market reflects the health of the country’s economy. We can gauge how much work is being done by looking at the performance of the stock market.” Parcha pointed out that while ordinary Pakistanis may not yet feel the immediate benefits of the market’s performance, it is expected to have a positive impact on inflation in the long term. He believes that the rise in stock market trading signals that the economy is improving, with investments flowing into the market, which in turn indicates job creation and economic activity.
**What’s Behind the Stock Market Surge?**
Stock market analyst Sheryar Butt noted two critical factors behind the current surge. “There was a time when discussions about Pakistan’s potential bankruptcy were common,” he recalled. However, following this period, the interim government took decisive action against currency hoarding and smuggling, while also engaging with traders. “During the caretaker government’s tenure, we began to see an improvement in the market’s performance,” Butt added.
The next major development was the resumption of Pakistan’s IMF program, which many had speculated might not happen. Butt believes that the revival of the IMF program provided a significant boost to investor confidence, leading to an uptick in stock market activity. “The IMF program not only stabilized the economy but also had a positive impact on the stock market. Moreover, the reduction in interest rates played a crucial role in further boosting investor sentiment,” Butt explained.
The combination of these factors, including the restoration of the IMF program and lower interest rates, helped rebuild confidence among investors, resulting in a sharp rise in trading volumes and, ultimately, the PSX crossing the 100,000-point milestone.
**The Path Ahead**
As the stock market continues to break records, experts remain hopeful that this upward trend will continue to have a broader positive impact on Pakistan’s economy. While the immediate benefits of a thriving stock market may not always be visible to the general public, the growth of the financial sector is expected to play a significant role in stabilizing the economy and reducing inflation in the coming months.
With investor confidence on the rise, Pakistan’s stock market has emerged as one of the key indicators of economic recovery, signaling a positive shift in the country’s financial landscape.
