The Pakistan Stock Exchange (PSX) rallied sharply on Wednesday, with the benchmark KSE-100 index gaining more than 4,000 points as investor sentiment strengthened amid optimism over possible talks between the United States and Iran.
US President Donald Trump has said negotiations between US and Iranian officials could resume in Pakistan in the next two days and Vice President JD Vance, who led weekend talks last week that ended without progress, said he felt positive about the situation.
“I think the next two days we’re going to see some incredible things,” Trump said. ABC News Journalist Jonathan Karl added that he did not believe it was necessary to extend a two-week ceasefire that ends on April 21.
The KSE-100 index, the benchmark of the PSX, rose to 170,179.03 points after registering a rise of 4,544.19 points or 2.74%, compared to the previous close of 165,634.84 points.
Ahfaz Mustafa, CEO of Ismail Iqbal Securities, said geo.tv: “Expectations that the Middle East conflict will be resolved by the weekend and lower oil prices have given new confidence to investors.”
“This, along with Saudi deposits and a general feeling of well-being due to Pakistan taking center stage, is fueling the rally,” the analyst added.
Arif Habib’s Ahsan Mehti said stocks staged a strong recovery as investors weighed a second round of US-Iran peace talks and Trump claimed the war was very close to over.
“The rise in global stocks and the expected receipt of $3 billion in financial support from KSA played a catalytic role in the bullish activity on PSX,” he added.
Saudi Arabia will provide $3 billion in additional support to Pakistan to help the South Asian nation close a multibillion-dollar gap in its finances linked to an upcoming debt payment to the United Arab Emirates.
The additional financing for Pakistan comes in addition to Riyadh’s extension of the agreement to renew an additional $5 billion deposit over a longer period, Pakistan’s Finance Minister Muhammad Aurangzeb told reporters in Washington.
Under Pakistan’s $7 billion IMF program, the country aims to have foreign exchange reserves of more than $18 billion by June.
“Senator Aurangzeb said this support comes at a critical time for Pakistan’s external financing needs and would help bolster foreign exchange reserves and strengthen the country’s external account,” the Finance Ministry said in a statement.
