Pakistan’s stock exchange (PSX) rallied on Wednesday, with the benchmark KSE-100 index rising over 4,000 points as investor sentiment was boosted by optimism surrounding potential talks between the US and Iran.
US President Donald Trump has said talks 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 a breakthrough, said he felt positive about where things stood.
“I think you’re going to see two great days ahead,” Trump said ABC News reporter Jonathan Karl, adding that he did not think it would be necessary to extend a two-week ceasefire that ends on April 21.
The KSE-100 index, the benchmark for the PSX, rose to 170,179.03 points after registering an increase of 4,544.19 points or 2.74%, up from the previous close of 165,634.84 points.
Ahfaz Mustafa, CEO of Ismail Iqbal Securities, told Pakinomist.tv: “Expectations that the conflict in the Middle East will be resolved before the weekend and lower oil prices have given new confidence to investors.”
“This, coupled with Saudi deposits and an overall feel-good sentiment due to Pakistan being at the center, is fueling the rally,” the analyst added.
Arif Habib’s Ahsan Mehnti said stocks staged a sharp rally as investors weighed a second round of US-Iran peace talks and Trump confirmed the war was very close to being over.
“Rising global stocks, expected receipt of $3 billion in financial support from KSA played a catalyst role in bullish activity at PSX,” he added.
Saudi Arabia will provide $3 billion in additional aid to Pakistan to help the South Asian nation bridge a multibillion-dollar gap in its finances linked to an upcoming debt repayment to the United Arab Emirates.
The extra funding for Pakistan comes on top of Riyadh extending the rollover arrangement for an additional $5 billion deposit for a longer period, Pakistan’s Finance Minister Muhammad Aurangzeb told reporters in Washington.
Under Pakistan’s $7 billion IMF program, the country is targeting 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 will help strengthen foreign exchange reserves and strengthen the country’s external account,” the finance ministry said in a statement.
