Stock Market: A Game of the Few?
Positive news on the economic front boosted the stock market’s bullish run as it broke the 72,500 barrier this week.
After a turbulent year, Pakistan has been able to keep inflation under control for March 2024. At the same time, the country also observed a record current account surplus of USD 619 million last month, an increase from USD 537 million in March 2023. This growth was primarily driven by elevated remittance inflows through official channels during Ramadan, coupled with a reduced trade deficit. All seems to be going well for Pakistan, and that also includes its stock market which crossed the 72,000 benchmark, creating a new record. There are a couple of factors behind the recent stock market bull run, including rising speculations about a rate cut and the possibility of securing a new IMF program.
Does this mean that Pakistan is finally out of the woods, as indicated by recent data, or should we wait cautiously for the upcoming budget news before drawing any conclusions?
The Pakistani stock market often follows cyclical trends, as positive results announcements, boosted investor confidence in seasonal sectors such as cement and steel. Despite a suspected rate cut, interest in banks remains consistent. The growing confidence in the stock market is further supported by the fact that it delivered a return rate of 55% last year, the highest seen in the market over the past decade. However, an analysis of the market’s performance in the second half of 2023 found that in addition to banks and energy, various sectors contributed to the growth as well. There is a possibility that the cyclical trend in addition to an increase in earnings, due to improving macroeconomic circumstances, may lead to another great year for stock investors.
Investments in Pakistan, whether in the stock market or otherwise, require a strong resolve. However, opting for low-priced stocks, particularly in the cement sector and banking industry, could potentially yield favorable outcomes for investors. This trend is driven by the declining attractiveness of bonds as investment options, fueled by rumors of impending rate cuts. While Pakistan's stock market has a relatively low capitalization, its role in the economy should not be confined to just a few sectors.
Macro Pakistani collaborated with Pakistan Food Systems Dashboard to explore and present the challenges being faced by Pakistan's agriculture and food sector.
GRAPHIC
Based on data of the 200-day genocide of the Gaza Strip by Israel, the daily death toll for Palestinians has reached 150, including 30 women and 55 children. These are horrifying statistics and unprecedented in the context of contemporary warfare.
The phenomenon of mass graves has also emerged for the first time in the history of the conflict, with the discovery of over 140 mass, random, or temporary graves in various parts of the Gaza Strip. Many of these individuals were buried on the spot after being executed by Israeli Occupation Forces (IOF).
Since the first day of this barbaric genocide, Israel has resorted to using starvation as a weapon of war, blocking aid entry, closing crossings, and limiting the types of aid that are permitted during any situation. Many starving people have even been killed while waiting for aid convoys.
This policy has been specifically directed at the people living in the Gaza Governorate and the Strip's northern regions, where 300,000 Palestinians continue to suffer from a true famine that has resulted in the death of 30 individuals, mostly children, and thousands of pounds of weight loss among the populace due to a lack of food, which has had a serious negative impact on their general health.
Industry and transportation together account for over 67% of Pakistan's energy consumption, a trend seen in India and Southeast Asia as well. Despite significant international assistance, Pakistan has overlooked climate considerations in its infrastructure investments.
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About Us: Macro Pakistani is a data-driven research platform that aims to provide a basic understanding of Pakistan’s economy. If you have an interest in contemporary news but are currently overburdened with sensationalism and specialized vocabulary, we are the platform for you.
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