Stocks extended gains on Thursday as renewed hopes of easing tension in the Middle East improved investor sentiment, even as crude oil prices rose after a sharp drop in the previous session.
During the session, the Pakistan Stock Exchange (PSX) benchmark KSE-100 index rose to an intraday high of 167,924.09, gaining 3,092.67 points, or 1.88%, and retreated to a low of 166,638.56, reflecting a gain of 1,807.14 points, or 1.10%, from the previous close of 164,831.42.
“A flurry of diplomatic measures to end the war created downward pressure on oil markets, with oil trading down around 6%,” said Ahfaz Mustafa, chief executive of Ismail Iqbal Securities.
“This signals the end of hostilities and the reopening of the Strait and eventually normalization, which boosted investor sentiment,” he added.
Asian markets also advanced on Thursday, supported by hopes for a Middle East peace deal after Iran said it was examining a new US proposal to end the war.
Japan’s Nikkei rose more than 3.5%, while South Korea’s benchmark Kospi index rose 6.8% in morning trading, and Samsung Electronics was trading 5.9% higher. Taipei rose 3.6%, Sydney gained 1.6% and Singapore rose 0.4%.
Hong Kong, Shanghai, Bangkok and Wellington also rose, although Jakarta lost 1.5%.
US President Donald Trump said on Wednesday that talks were on the “borderline” between a deal and new attacks, adding to cautious optimism in financial markets.
Oil had fallen more than 5% on Wednesday as peace hopes gained strength, but crude oil prices rose on Thursday. West Texas Intermediate rose 0.5% to $98.75 a barrel, while North Sea Brent crude rose 0.4% to $105.43 a barrel.
On the domestic front, the government raised Rs 688 billion in realized value from the market’s treasury bill auction on Wednesday, with yields rising across all tenors.
The cutoff yield on one-month Treasury bills rose 86 basis points to 12.23%, while the three-month yield rose 41 basis points to 12.4904%. The six-month yield rose 15 basis points to 12.4999%, and the 12-month yield rose nine basis points to 12.59%.
The government raised Rs 702 billion in face value from the auction against a target of Rs 450 billion and a maturity of Rs 479 billion, while participation stood at Rs 1.73 trillion.
In the previous session on Wednesday, the KSE-100 index rose 1,934.74 points, or 1.19%, to close at 164,831.42 against the previous session’s close of 162,896.68.
The index hit an intraday high of 165,081.7 and a low of 162,895.74, while the KSE-30 index gained 669.37 points, or 1.37%, to end at 49,356.83.
