Great expectations!

And so it has begun. The KSE-100 has finally broken through its downward sloping consolidation and started eyeing the 25,000 level. The benchmark index hit its highest ever mark of 24,007 yesterday, before retracing to a marginally negative close.
The rise in KSE-100 coincides with developments in the primary market. Stories of mergers, acquisitions, restructuring have begun to make rounds. A few months after the Lalpir Power sale, Engro Fertilizer and Avanceon Limited plan to sell their shares to public. Meanwhile, Meezan Banks strategic acquisition is on the cards, where Noor Financial is seen selling its stake to Vision Holdings. Then Bestway Cement is also merging its subsidiary Mustehkam Cement with and into itself.
These may well be "company specific" developments, as Faisal Shaji Head of Research at Standard Capital points out while making a reference to Lalpirs and Engros need to manage their debts. Shaji also points out to what he calls "financial re-engineering"; whereby foreign firms are either delisting from the bourse by buying back the shares or other restructuring. Cases in point: the Unilever Pakistan buyback, the Clariant Pakistan restructuring, as well the possible buyback by Siemens Pakistan.
But then, isn it also true that changes in strategic shareholdings, restructuring etc, usually happen around the turning or reversal points of an economy, be it at or near the reversal from the bottom or from the top.
Seen from this perspective, developments related to foreign firms have their own respective reasons related to global realignment as global economy tries to find its direction. And developments on the local front seem to fit the narrative of Pakistan Rising that is being built since the elections earlier this year.
There is a lot of hype and positivism in the business circles--and also in the capital. Some green shoots--and agreed they are only some--are also visible in the form of partial resolution of circular debt, privatisation plans, 3G auctions, likely finalisation of new gas policy, etc. Some also take hope from the fact that--unlike the previous regime-at least this government is trying to reach some kind of resolution for the sister crises of terrorism and law & order.
Then again, the trouble with hype is: it doesn last forever. Pakistans macroeconomic indicators are still susceptible, domestic and consumer sectors have slowed; thanks to lesser government spending, where all of the talks of progress and betterment--are, well, talks at the moment. And, if all these talks don converge into action soon, all this hype would be gone, as if they were horns on a donkeys head.