By Staff Reporter
KARACHI: Pakistan’s benchmark KSE-100 Index soared to an all-time high on Friday, climbing 1.91% to 124,379.07, as local institutions bought aggressively after lawmakers approved the 2025 budget.
The gain capped a 3.63% weekly rise, reflecting optimism over economic stability.
The surge came a day after lawmakers passed the federal budget for fiscal year 2025-26, with a total outlay of Rs17.57 trillion, despite opposition pushback.
“Bull dominated today’s trading session on aggressive buying by local institutions, as the KSE-100 Index increased 1.9% to close at its ever high level,” Topline Securities said in its post-market report. “This buying by local institutions can be attributed to fresh liquidity on rumored new year allocations towards equity funds.”
Friday’s gains were led by heavyweights like FFC, LUCK, MEBL, POL, ENGROH, EFERT, and OGDC, which together contributed 1,044 points to the index, according to Topline.
Ali Najib, an analyst at Arif Habib Limited, pointed to “institutional driven buying ahead of FY26 re-allocation towards equities” as a key driver. “In addition, yesterday’s National Assembly budget approval also taken positively by investors community,” he said.
The budget’s passage on Thursday, supported by coalition partners, incorporated some amendments but rejected all opposition proposals.
Awais Ashraf, director of research at AKD Securities, noted that the budget’s “absence of aggressive incremental revenue measures and slight relief for salaried and business is also well received by the investors.”
The market’s bullish run this week was further fueled by a ceasefire between Iran and Israel, brokered by U.S. President Donald Trump earlier in the week, ending a 12-day conflict. The announcement sparked a 6,079.16-point jump on Tuesday, though profit-taking dragged the index down on Thursday.
“The ceasefire between Iran and Israel has redirected investor focus toward improving macroeconomic fundamentals,” Ashraf said. “Lower inflation and a record current account surplus are strengthening the case for a potential decline in interest rates to single digits.”
Topline Securities tied the week’s 3.63% gain to the easing of geopolitical tensions, which “triggered buying by investors before fiscal year end.” Stocks tied to power and oil and gas exploration, along with their supply chains, gained traction amid expectations of circular debt clearance ahead of the fiscal year-end.
The KSE-100’s path to Friday’s record wasn’t without turbulence. After two days of gains following the ceasefire news, Thursday saw persistent selling pressure erase 715.18 points, closing the index at 122,046.46 as investors cashed in profits. Friday’s rebound underscored resilient sentiment, with institutional buying signaling confidence in Pakistan’s economic trajectory.
Analysts see room for the rally to continue. “We anticipate the market rally to sustain, supported by continued monetary easing, as inflation is projected to fall even below the FY25 estimate of 4.5pc in FY26,” Ashraf said. With inflation cooling and the current account posting a record surplus, the prospect of single-digit interest rates could keep equities in favor.
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