The KSE-100 index, the benchmark index of the Pakistan Stock Exchange, hovered over a 34-week high at 42,647 points on Thursday.
The KSE-100 improved by 625 points. The last time it was above 42,647 points was on January 21. The top three point gaining sectors were banks, exploration and production and cement.
In the last three weeks, the market has been bullish as it increased by 3,026 points, which shows investors are regaining their trust in the market.
The index has been rising after reaching its lowest level in March when the World Health Organisation declared COVID-19 a pandemic and soon after stock markets across the world reacted to it.
“The investors are reacting to positive macroeconomic results such as an increase in foreign exchange reserves and an expectation of a rise in exports. Another reason for this boost is a low interest rate which demotivates financial institutions such as banks and mutual funds to invest in government bonds, and with gold also showing unpredictable trends the only option which is guaranteeing high return is the stock market,” Raza Jafri, director research at Intermarket Securities, told SAMAA Digital.
Gold has seen a drop in prices since last week as the country is recovering from COVID-19 and people are selling gold which was considered a safe haven during the pandemic.
Dollar reserves of the country were at a six-month high last week when it reached $12.712 billion. The launch of Roshan Digital Account is expected to boost it further.
According to Raza, new people are entering the stock market and the market will continue to rise till December 2020.