MC Markets Graphixstory: What is behind Pakistan's galloping stock markets?

The main driver of the market’s rally has been fuelled by several positive developments, including Pakistan's ability to secure a loan from the International Monetary Fund (IMF)

Though the Indian market’s rally in the past year has given smiles to all local investors, however, it pales in comparison to how the market in neighbouring Pakistan has performed.

Pakistan's flagship KSE100 index is the second-best performing headline index in the world in the last year delivering about 63 percent returns. The index lags behind only Argentina's S&P MERVAL, which soared 360 percent in a year.

The main driver of the market’s rally has been fuelled by several positive developments, including Pakistan's ability to secure a loan from the International Monetary Fund (IMF). Inflation is also coming under control. Moreover, with the national elections scheduled next month, there are high hopes for increased stability.

All this has led to a surge in foreign investment in Pakistan's stock markets.

As many as 21 stocks in the KSE 100 index have turned into multi-baggers last year. Pak Gulf Leasing Co Ltd is the top performer with a 240 percent gain, while Pakgen Power Ltd, Colgate Palmolive, Standard Chartered Bank Pakistan Ltd and Attock Refinery Ltd are some other top performers delivering more than 150 percent returns.