Pakistani equities are drawing renewed attention from major global asset managers after the Pakistan Stock Exchange (PSX) achieved an unprecedented 84% growth last year, making it the top global performer, according to Bloomberg.

Prominent firms such as BlackRock Inc. and Eaton Vance Corp. have reentered or increased their stakes in the market. Notably, BlackRock’s Frontiers Investment Trust allocated 5% of its portfolio to Pakistani stocks in December 2024, marking a return after nearly two years of absence. Eaton Vance also reentered the market in mid-2024, while Legal & General Investment Management Limited and Evli Fund Management Company have boosted their holdings.

Intermarket Securities Ltd forecasts a 40% gain for the KSE-100 Index this year, indicating growing investor confidence. A portfolio manager at Morgan Stanley Investment Management Inc. highlighted strong earnings growth as a key driver of the anticipated rally.

Despite the optimism, political uncertainty and Pakistan’s downgrade to frontier market status by FTSE Russell in September have led to net foreign selling in late 2024. However, fund managers remain optimistic, suggesting that if Pakistan can manage its current account deficit, the market could experience a multi-year rally.