KSE-100 reaches historic 120,000 points after power tariff reduction

Shares in the Pakistan Stock Exchange (PSX) have crossed the 120,000-point barrier, reaching a historic high following a bullish rally that began at the start of intraday trading and continued until the first break.

Trading started on a slow note on Friday morning but quickly gained momentum, attracting investors within an hour and pushing the KSE-100 index to 120,796.67, with an increase of 1,858.56 points by 10:00 am.

Notably, the market had closed at 118,938 on Thursday.

According to the Chief Executive Officer of Topline Securities, the recent announcement by Prime Minister Shehbaz Sharif was a significant factor in this transformation. 

Read: PSX soars to historic 100,000 milestone

The Prime Minister's announcement raised expectations of improved earnings following the "power tariff cut" and his commitment to resolving circular debt.

Yousuf M Farooque, Director of Research at Chase Securities, noted that while the US-imposed tariff had initially jolted investor interest, the decline in electricity prices helped restore confidence.

Earlier, Prime Minister Shehbaz Sharif had announced a Rs7.41 per unit decline in power tariff across the country, aiming to reduce the burden on citizens facing high electricity bills. For industries and commercial users, he declared a cut of Rs7.69 in electricity prices.

Read: PM Shehbaz felicitates nation over PSX's historical achievement 

Farooque added that this move also contributed to boosting investor interest, as inflation expectations eased in response to falling energy costs.

Regarding US tariffs, he stated that while Pakistan is not heavily reliant on the US, it is crucial to monitor the indirect effects of these tariffs, including potential slowdowns in trade with other countries and a possible decrease in remittances from overseas Pakistanis.