PSX: rally continues, KSE-100 crosses 169,000 level

The Pakistan Stock Exchange (PSX) continued to rally on Wednesday, with the KSE-100 Index surging past the 169,000 mark. Traders were optimistic about the potential impact of US midterm election results on Middle East peace talks, prompting early buying activity. By 9:55am, the benchmark index was trading at 169,345.64, up 1,326.78 points or 0.79% from the previous close.

Key sectors such as automobile assemblers, cement, commercial banks, oil and gas exploration companies, OMCs, power generation and refineries witnessed significant buying. Index-heavy stocks like ARL, HUBCO, MARI, OGDC, PPL, POL, MCB, MEBL, NBP and UBL all traded in the green. The rally on Tuesday was attributed to easing international crude oil prices and optimism over potential US-Iran negotiations, which boosted investor sentiment.

Globally, US stock futures fell while Treasuries rallied and the dollar weakened, as Democrats made early gains in Senate elections, potentially altering Washington's power dynamics. The outcome of these elections remains uncertain. Meanwhile, in North Carolina, former Governor Roy Cooper defeated Trump-backed Republican Michael Whatley, shifting a Republican-held Senate seat to Democrats.

In Georgia, Democrat Jon Ossoff won re-election, contributing to Democratic gains that could secure a majority. Market predictions suggest a Democratic sweep of the US Congress, with billions wagered on the election outcomes. Despite these developments, market-sensitive sectors like AI, fiscal outlook, defence spending, and regulation in areas like healthcare, banking, and cryptocurrencies remain under scrutiny.

In Asia, stocks fell as investors discounted strong earnings from AMD, dampening enthusiasm for the AI trade. MSCI's broad Asia-Pacific index excluding Japan slipped 0.5%, with South Korea's KOSPI down 1.6% and Japan's Nikkei falling 3%.