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KARACHI:
Pakistan’s stock market staged a strong recovery in the outgoing week, where the benchmark KSE-100 index surged 4,356 points, or 3.6% week-on-week (WoW), to close at 124,379.06. The rally came after investor sentiment improved sharply following a ceasefire announcement in the Middle East, easing geopolitical concerns and stabilising oil prices.
Despite a cautious start, the index recorded its second-largest single-day gain on Tuesday, surging 6,079 points (+5.23%). Meanwhile, economic developments, including the passage of Finance Bill 2025, a $4.5 billion commercial loan to address power sector debt and a sharp fall in State Bank of Pakistan’s (SBP) reserves, remained in focus.
On a day-on-day basis, the PSX faced a sharp sell-off on Monday as escalating geopolitical tensions rattled investor confidence and triggered panic selling. The KSE-100 index recorded a plunge of 3,856 points, or 3.21%, and settled at 116,167.
On Tuesday, peace in the Middle East ignited a rally and the local bourse rebounded on ceasefire optimism, posting a historic second-highest gain of over 6,000 points by ending the day’s affairs at 122,247 (+5.23%) and reconquering the 120k psychological level.
However, the market had a range-bound day on Wednesday. The index mostly remained positive, during which it touched intra-day high of 123,257 (+0.83%) and low of 122,169 (-0.06%). It ended the day at 122,762, up 515 points, or 0.42%.
After a surge of almost 6,600 points (+5.7%) in two sessions post Iran-Israel ceasefire, the PSX had a profit-taking day on Thursday. Resultantly, the index wrapped up the session at 122,047 by shedding 715 points, or 0.58%.
Nonetheless, the market resumed its bullish momentum on last trading day of the week and the KSE-100 ended at 124,379 with impressive gains of 2,333 points, or 1.91%. Robust buying by institutional investors provided boost, driven by expectations of FY26 equity reallocations and budget approval by the National Assembly.
Arif Habib Limited (AHL), in its weekly report, said the market opened under pressure in the outgoing week as investor sentiment turned cautious amid escalating geopolitical tensions in the Middle East, driving uncertainty across global markets and weighing on the KSE-100 index. However, following news of a ceasefire on Tuesday, the market staged a strong rebound, recording its second-largest single-day gain of 6,079 points (+5.23%).
On the economic front, it mentioned, the SBP raised Rs345 billion in T-bill auction against the target of Rs650 billion, where yields dropped 3-9 basis points across all tenors. Additionally, Rs251.5 billion was raised through the government of Pakistan Ijara Sukuk, which exceeded the target of Rs175 billion.
Power generation in May 2025 rose 1% year-on-year (YoY) to 12,755 gigawatt hours (GWh), while cumulative Roshan Digital Account (RDA) gross inflows reached $10.4 billion as of May. Meanwhile, SBP’s foreign exchange reserves declined by $2.66 billion to $9.06 billion, primarily due to external debt repayments, including commercial borrowings. Pakistani rupee depreciated by 2 paisa WoW to close at 283.72 against the US dollar, AHL said.
Sectors that contributed positively to the stock market were commercial banks (1,120 points), cement (691 points), fertiliser (629 points), exploration & production (577 points) and glass and ceramics (146 points). Meanwhile, sector-wise, negative contribution mainly came from miscellaneous (84 points).
Among individual stocks, positive contribution came from Lucky Cement (382 points), Fauji Fertiliser Company (357 points), UBL (319 points), Meezan Bank (316 points) and OGDC (192 points). Scrip-wise, negative contributors were Pakistan Services (133 points), Pakgen Power (96 points), International Steels (7 points), Colgate-Palmolive (6 points) and SNGPL (5 points). Foreign selling was witnessed during the week under review, which came in at $11.78 million compared with net buying of $0.46 million last week.
Wadee Zaman of JS Global noted that the KSE-100 index gained 3.6% WoW, driven by easing tensions in the Middle East amid a ceasefire announcement by the US president, which also helped cool off oil prices after recent spikes. Average daily turnover fell 10% WoW.
On the economic front, he said, the National Assembly passed the Finance Bill 2025 with a total outlay of Rs17.6 trillion. Separately, the government secured a $4.5 billion loan from commercial banks to address power-sector circular debt at Karachi Inter-bank Offered Rate (Kibor) minus 0.9%, in line with IMF conditions.
