Since the endorsement of the 26th Constitutional Amendment by the Pakistan Stock Exchange (PSX), the KSE-100 index in particular has increased significantly and is currently at an all-time high level of 86,701 points. For the second trading day running, the KSE-100 index rose by 643 points, which is a gain of 0.75 percent. This positive trend commenced yesterday when the KSE-100 index surged 807 points and ended the day at 86057.

This increase in the index figures has been primarily caused by the easing of political instability after the voting and approval of the Amendment. As Topline Securities’ CEO Muhammad Sohail states, there now exists a political rationale for the market to endorse the 26th Amendment; hence, it allows investors to come back to the market.

Also, Chase Securities Research Director Yousuf M. Farooq also shared the view of the market growth, expressing that participants are optimistic that the economic situation is likely to remain stable with the political situation getting better.

The 26th Constitutional Amendment, which has received a two-thirds majority from both the Senate and the National Assembly, has positively improved the confidence of investors. Naturally, as Pakistan approaches political sanity, the financial markets would respond in a positive way.

Besides political events, these analysts point out that the mood of the investors was enhanced by the ongoing Shanghai Cooperation Organization (SCO) summit and the recent visit of the Chinese Prime Minister. As Awais Ashraf, Director of Research at AKD Securities, explains, promises of additional financial support coming from China have increased market confidence.

There has been an appreciable upward movement of the Pakistan Stock Exchange for the month of October, with a number of the trading days exhibiting positive growth. On October 9, the KSE-100 Index climbed back to its previous peak of over 86,000 before settling down at over 85669. On October 8, the index rose by 753 points to close at 85663, which reflected optimist sentiment in the market.

Due to the prospects of political calm alongside international monetary assistance, investors expect that the positive trend in the Pakistan Stock Exchange will be extended to the next few weeks.

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