Stocks closes at 2nd best level, rupee at 6-month high

Pakistan stocks closed near their record high on Thursday propelled by key economic reports suggesting that the economy is stabilizing; while the rupee strengthened against dollar to a 6-month high.

The rate cut by FED also lifted market sentiments as this would mean more foreign inflows in the local market.

Muhammad Sohail at Topline Securities said stocks reached an all-time intra-day high, breaching 82,000 points and delivering an impressive annual return of nearly 80%, making it one of the top-performing markets globally.

Slower-than-expected selling due to FTSE rebalancing has encouraged local investors to accumulate shares. Additionally, falling bond yields are shifting focus towards equities.

The KSE-100 index gained 1.24% or 997.95 points to close at 81,459.29 points.

Indian equities closed on a strong note on Thursday trade. Gains in the banking, FMCG, and real estate sectors pushed the index up in the trading session.

In addition, the Federal Reserve's more significant-than-expected rate cut boosted global stocks, leading to record highs for India’s benchmark equity indices.

India’s BSE 100 Index gained 0.09% or 23.81 points to close at 26,871.89 points.

The Dubai Financial Market (DFM) General Index gained 0.71% or 31.32 points to close at 4,421.52 points.

Commodities

Oil prices rose on Thursday after a large interest rate cut from the U.S. Federal Reserve. Interest rate cuts typically boost economic activity and energy demand, but the market also saw it as a sign of a weaker U.S. labor market that could slow the economy.

Weak demand from China's slowing economy also continued to weigh. Refinery output in China slowed for a fifth month in August, statistics bureau data showed over the weekend.

Brent crude prices surged 0.71% to $74.36 per barrel.

Globally, gold climbed over 1% on Thursday after the Fed rate cut, powering bullion to all-time highs.

The 50-basis-point rate cut could help extend the current uptrend in gold prices, which could continue to see new records, thanks to other additional supporting factors. The decision acts as a start of an interest rate cut cycle that markets have long been waiting for and could fuel appetite for assets like gold and others.

International gold prices gained 1.15% reaching $2,588.61 per ounce. In Pakistan, gold prices eased by PKR 800 to PKR 268,500/tola on Thursday.

Currency

US dollar eased further against PKR, down 0.04% in the inter-bank market. Pakistani currency settled at 277.91, a gain of 13 paisas against the US dollar. In the open market USD was trading at PKR 280.5.