PSX trounces rest of the world in past three months: report
With stocks trading at overbought levels, its probably inevitable theres a pause for breath.
(Web Desk) – Pakistan’s KSE-100 Index has advanced to the highest level in seven months, after falling to the lowest in almost five years in August, amid attempts by the government to stabilize the economy with a $6 billion loan from the International Monetary Fund after a deficit blowout.
According to a report published in the Bloomberg, the rally that’s helped Pakistan stocks trounce the rest of the world in the past three months isn’t done yet. At the same time, bond yields have begun to fall after peaking around 14% mid-year, making debt investments less attractive.
Large investors, including mutual funds and insurers, are expected to jump in as double-digit returns from fixed income have begun to ebb away.
The report further said, “Banks are rethinking their strategy. They have to look at riskier assets now. So, the stock market is a tempting bet.”
With stocks trading at overbought levels, it’s probably inevitable there’s a pause for breath, the report said. The rally will resume as more investors come in. The KSE-100 fell on Wednesday after five straight days of gains.
Foreign investors have bought $64 million of the nation’s stocks this year, set for the first annual inflow since 2014. Their purchases will gather pace February after the nation’s next review by the Financial Action Task Force, the report added.
