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Stocks in Pakistan and India surged on Monday following a ceasefire agreement between the two nuclear-armed neighbors on Saturday. Pakistan’s KSE-30 Index jumped by 9.2%, while India’s Nifty 500 Index soared as much as 3%. On Friday, investors got nervous as the Nifty dropped more than 1%, its steepest fall in over a month. The Indian rupee was also one of Asia’s worst performers last week. India’s bond yields surged as risk premiums widened, although debt purchases by the Reserve Bank of India helped mitigate the drop. Pakistan’s KSE-30 Index slid 9% since the April 22 attack in Kashmir, which prompted India to retaliate. Pakistan and Indian stocks soar following ceasefire agreement Pakistan’s stock benchmark, the KSE-30 Index, soared more than 9.2%, the most since 2008, triggering a one-hour halt in trading. The NSE Nifty 50 Index also surged as much as 3% in Mumbai. Stocks in both countries jumped after a ceasefire deal between the two nuclear-armed nations on Saturday. Ali Raza, head of international trading at BMA Capital Management Ltd., argued that investor focus is expected to return to accelerating economic reforms following the easing of war tensions.  “Given how quickly things were escalating last week, the developments over the weekend are a move in the positive direction. The focus could return to the Indian growth story.” -Vivek Dhawan, Fund Manager at Candriam. Dhawan also noted that India’s positive economic signals suggest that foreign investors, who had been on a near 3-week buying streak until Friday, may resume inflows. He also sees increased inflows from prospects of an early U.S. trade deal, ample liquidity, and anticipated interest rate cuts. The fund manager also argued that traders in Pakistan expect the country’s economic reforms to regain focus as border tensions had exceeded a surprise interest-rate cut by the State…

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Filed under: News - @ May 12, 2025 11:23 am