Pakistan’s stock market has delivered an impressive 35% return in both rupee and US dollar terms since September 2024, driven by robust net inflows from local mutual funds. According to a report by Topline Securities, mutual funds have aggressively invested $207 million (Rs. 58 billion) during this period, shifting from fixed-income instruments to equities.

The report highlights that the shift to equities has been fueled by a significant decline in yields on fixed-income instruments. Yields on 12-month and 6-month Treasury Bills have dropped by 1,253-1,261 basis points, falling from their September 2023 peaks of 24.73% and 24.51% to 12.20% and 11.90% as of December 19, 2024. This decline has made equities a more attractive investment option for funds and investors alike.

Stock Market Recovery After Sell-Off
The Pakistan Stock Exchange (PSX) ended the week on a positive note after suffering two consecutive days of heavy losses. The benchmark KSE-100 index, which had lost over 8,500 points on Wednesday and Thursday, rebounded strongly on Friday. The index gained 3,238 points, closing at 109,513 points, marking a 2.96% increase from the previous session.