Pakistan Stock Market Records Historic High as SBP Rate Cut Expected

The Pakistan Stock Exchange (PSX) started the New Year on a bullish note, with aggressive buying by local mutual funds pushing the benchmark index to a record high. Optimism around a potential cut in the State Bank of Pakistan’s key interest rate fueled investor confidence, driving broad based participation across the market.

The benchmark KSE-100 index surged to an intraday high of 182,408 points, closing with a remarkable gain of 3,373 points (1.88%). Top contributors included UBL, HBL, ENGRO, MCB, EFERT, and FFC, which collectively added +1,853 points to the index.

Traded volume and value for the session stood at 1.3 billion shares and Rs. 77.9 billion, with BOP emerging as the volume leader, trading 95 million shares. Market analysts suggest that the firm close near the day’s peak reflects strong investor confidence and a buoyant start for equities in 2026.

Topline Securities noted that expectations of an SBP interest rate cut in the upcoming monetary policy meeting significantly boosted market sentiment. Analysts believe that continued foreign and local institutional support could sustain the bullish momentum in the coming weeks.

After a period of volatility in late 2025, Pakistan’s equity market is showing signs of recovery. The positive start to 2026 is attributed to liquidity inflows from mutual funds and renewed investor appetite, signaling a potentially strong year for equities if macroeconomic indicators remain favorable.