Benchmark index jumps 4.23% to 178,262 points as investors return to equities
KARACHI: The benchmark KSE-100 Index staged a powerful rally on Monday, soaring by more than 7,200 points as investor confidence strengthened following the State Bank of Pakistan’s (SBP) decision to keep the policy rate unchanged and growing optimism over a potential US-Iran peace agreement.
The benchmark index climbed 7,241.1 points, or 4.23%, to close at 178,262.3 points, marking one of the strongest single-session gains in recent months.
The rally was driven by renewed buying across key sectors after the SBP maintained the policy rate at 11.5%, reinforcing expectations of macroeconomic stability. Investor sentiment also improved on reports suggesting diplomatic efforts between the United States and Iran could reduce geopolitical tensions, easing concerns over global energy markets.
The sharp advance pushed the KSE-100 into bullish territory, with investors aggressively accumulating blue-chip stocks amid improving market fundamentals and expectations of stronger corporate earnings.
Market capitalisation at the Pakistan Stock Exchange (PSX) also increased significantly, rising 3.9% from the previous session to Rs20.02 trillion (approximately $72.1 billion). On a year-to-date basis, market capitalisation is now up 1.7%.
Trading activity remained exceptionally strong during the session. Total traded volume reached 1.03 billion shares, while the total traded value stood at Rs41 billion (around $147.6 million), reflecting robust investor participation across the market.
Activity in the futures market was also healthy, with 512.4 million shares changing hands and a traded value of Rs16.6 billion, indicating increased interest from institutional and speculative investors.
Leading the rally were banking, cement and oil-related stocks, with broad-based buying seen across most major sectors. Analysts said investors were encouraged by expectations that a stable interest rate environment would support corporate profitability while easing geopolitical risks could help stabilise global oil prices and improve Pakistan’s external outlook.
Market participants also welcomed signs of improving macroeconomic stability, including easing inflationary pressures, stronger foreign exchange reserves and continued implementation of economic reforms under the IMF-supported programme. These factors have strengthened expectations of sustained economic recovery and improved earnings prospects for listed companies.
Analysts said the combination of stable monetary policy, easing geopolitical concerns and expectations of improving macroeconomic indicators has significantly boosted market confidence. However, they noted that investor sentiment will continue to depend on developments in international oil prices, regional geopolitical conditions and upcoming domestic economic data.
The latest rally underscores growing optimism that Pakistan’s equity market could sustain its recovery if economic stability continues and external risks remain contained.