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Pakistan’s stock market continued its bullish streak for a second consecutive week, with the KSE-100 index hitting an all-time high of 189,167 points, marking a 4,068-point weekly gain (+2.2%). Investor confidence was bolstered by easing geopolitical tensions, fresh liquidity, and expectations of further monetary easing after T-bill yields returned to single digits for the first time in four years.
The week saw a mix of record highs and profit-taking sessions, with the index closing at 187,762 (+1.44%) on Monday, 188,622 (+0.46%) on Tuesday, dipping to 187,003 (-0.84%) on Wednesday, and rebounding to 189,167 (+0.79%) by Friday. According to Arif Habib Limited (AHL), positive market sentiment was supported by policy expectations, improved macro indicators, and a strengthening Pakistani rupee, which appreciated slightly to Rs279.86/$.
On the economic front, power generation rose 8.8% YoY, reaching 8,487 GWh in December, while Pakistan posted a current account deficit of $244 million in Dec’25, reversing surpluses seen in previous months. Net FDI inflows also fell 43% YoY to $808 million in 1HFY26.
Syed Danyal Hussain of JS Global emphasized the impact of falling T-bill yields on market optimism: “Cut-offs declined by 16-31 basis points across maturities, strengthening expectations of further policy rate easing.” Meanwhile, the government is reportedly seeking billions of dollars in low-cost loans from international institutions and Saudi Arabia to refinance power sector debt and reduce industrial electricity tariffs.
The stock market also witnessed Pakistan’s first IPO of 2026, Pak-Qatar General Takaful, which recorded a 21x oversubscription, reflecting strong investor appetite.
Overall, the PSX’s current bullish momentum highlights investor optimism driven by improved liquidity, dovish monetary policy signals, and signs of macroeconomic stability.
