Karachi, The Karachi Stock Exchange (KSE-100) reached an unprecedented peak in April, as the index closed at an all-time high of 72,743, marking a substantial monthly increase of 6.1%. The surge was primarily driven by renewed investment dialogues with Saudi Arabia and Iran, alongside continued macro-economic stability measures, which boosted investor confidence significantly.

According to JS Global, investor sentiment has been buoyed by a series of positive developments, including robust corporate results and significant foreign institutional portfolio investments, which saw a net inflow of US$48 million. Notably, the investment outlook remains optimistic with projections indicating that the KSE-100 could potentially hit the 100,000 mark within the year, underpinned by strong profit and dividend growth forecasts across various sectors.

Trading volumes also showed remarkable growth, with a 40% month-over-month increase in shares traded, and a 59% rise in trading value, surpassing levels seen before Ramadan. The end of the month, however, did see some profit-taking actions as the central bank's decision to maintain the policy rate countered some market expectations.

In a pivotal move, the International Monetary Fund (IMF) approved the disbursement of the final US$1.1 billion tranche of a US$3 billion Stand-By Arrangement to Pakistan. This endorsement by the IMF, recognizing the efforts to stabilize the economy, coincides with the central bank's decision to maintain a tight monetary stance, which is deemed appropriate until inflation reduces to more moderate levels.

Additionally, sectors like fertilizers and pharmaceuticals were among the best performers in April, largely due to high corporate profitability and favorable regulatory changes in the pharmaceutical sector.

The financial outlook for the KSE-100 remains robust as analysts reiterate a strong buy outlook, anticipating significant returns driven by earnings growth and high dividend yields. The current price-to-earnings ratio of under 4x, even at new highs, suggests that the market may still be undervalued, offering attractive opportunities for investors.