PSX Soars as Positive Developments Converge

The Pakistan Stock Exchange (PSX) experienced a robust recovery on Monday, fueled by a confluence of favorable circumstances, notably a ceasefire agreement and the International Monetary Fund (IMF) sanctioning essential funds. During the initial trading hours, the KSE-100 Index, a key market indicator, saw a significant rise of nearly 10,000 points.

Market Surge and Halt

As of 9:30 am, the KSE-100 Index stood at 117,104.11, marking an increase of 9,929.48 points, equivalent to 9.26%. This increase represents the most substantial single-day opening gain ever recorded at the PSX.

Mohammed Sohail, CEO of Topline Securities, commented that the stock market in Pakistan began trading with a remarkable surge, reaching 9,900 points or 9.3%. He attributed this positive trend to the ceasefire and the IMF’s approval of the loan tranche over the weekend.

Trading was temporarily suspended after the market jumped by 9%. The PSX issued a notice stating that trading had been halted due to a 5% increase in the KSE-30 index from the previous day’s close, in accordance with PSX regulations.

Sohail noted that this market halt due to an upward surge was the first in two years.

Continued Bullish Momentum

The market reopened at 10:42 am, with the bullish trend persisting. By 11:50 am, the benchmark index was recorded at 116,437.83, reflecting a gain of 9,263.2 points or 8.64%.

Across-the-board buying activity was evident in vital sectors, including banking and energy. Major stocks such as HUBCO, NRL, MARI, OGDC, PPL, POL, PSO, SNGPL, SSGC, HBL, MEBL, MCB, and UBL all traded positively.

Analysts’ Perspectives

According to a report by Arif Habib Limited (AHL), a combination of favorable events has created an environment for a potential revival in the PSX, with Monday’s trading session expected to start on a distinctly positive note.

The brokerage firm projected a significant rally for the KSE-100 index, potentially gaining 6–7%, and anticipated that many stocks would close near the upper limit of 10% as investor sentiment shifted from apprehension to optimism.

The ceasefire agreement is the most important factor. It is a diplomatic achievement that greatly lowers geopolitical risk in the region. The announcement came after a period of increased tension, which had led to significant selloffs and widespread investor concerns.

The US President’s recent statement expressing support for resolving the Kashmir issue and promoting enhanced trade relations further bolstered the positive sentiment.

The report stated that the ceasefire, IMF support, monetary easing, and a positive shift in trade relations collectively create a powerful combination of bullish factors as the market attempts to recover from a sharp correction that began on April 22, 2025, following regional tensions.

AHL pointed out that the KSE-100 index had fallen by 12.6% since April 22nd, 2025.

Previous Week’s Performance

The PSX had closed negatively in the previous week, as rising geopolitical tensions between Pakistan and another country impacted investor confidence.

Continuous uncertainty surrounding regional stability triggered widespread caution, negatively affecting market performance throughout the trading week, except for a strong recovery on Friday.

The KSE-100 Index declined by 6,939 points, or 6.1%, on a week-on-week basis, closing at 107,175 points compared to 114,114 points in the prior week.

Global Market Overview

Global stock futures saw an increase and the dollar strengthened against safe-haven currencies, due to signs of advancement in trade negotiations, boosting hopes that a global recession might be prevented.

Geopolitical tensions also appeared to be decreasing as a ceasefire was holding, while a president expressed readiness to meet with another president for discussions.

Progress in trade discussions was highlighted, and officials stated that consensus had been reached. A joint statement was anticipated. Markets reacted, with futures rising and indices firming.