KARACHI: The Pakistan Stock Exchange (PSX) recorded a strong rally on Monday as investor sentiment improved following a breakthrough US-Iran peace deal, a sharp decline in global oil prices and optimism over Pakistan’s latest federal budget.
The benchmark KSE-100 Index surged to an intraday high of 176,917.76 points, gaining 4,517.86 points, or 2.62%, before fluctuating slightly during the session. The market also touched a low of 175,524.22 points, still reflecting strong gains from the previous close.
Market participants said the rally was driven by easing geopolitical tensions after the United States and Iran announced an agreement to end their conflict and reopen the Strait of Hormuz, a key global energy route. The development triggered a drop in crude oil prices and improved global risk appetite.
Analysts noted that lower oil prices reduced concerns about inflationary pressures and the likelihood of further interest rate hikes, encouraging broad-based buying across sectors.
According to market experts, sentiment was further supported by Pakistan’s federal budget for FY27, which was viewed as growth-oriented. The budget includes measures such as tax relief for key industries, reduced super tax rates for many companies, and increased development spending.
Economists said these steps, combined with strong remittance inflows and easing external pressures, helped strengthen investor confidence in the short-term outlook.
The rally was also supported by expectations ahead of the State Bank of Pakistan’s monetary policy review, with investors closely watching interest rate signals after a recent hike in the previous meeting.
Sectors such as cement, construction, exporters and refineries saw increased buying interest due to anticipated fiscal incentives and tax reductions.
Overall, the PSX continued its upward momentum from the previous session, reflecting renewed optimism in both domestic economic policy and global geopolitical stability.