KARACHI (Kashmir English): The Pakistan Stock Exchange (PSX) witnessed a major rally on Friday, surging nearly 1,600 points just a day after the federal budget for 2025–26 was passed. The KSE-100 index climbed 1581.77 points, or 1.3 per cent, to stand at 123,628.23 at the close of the first session, from the last close of 122,046.46 points.
Awais Ashraf, director research at AKD Securities, said, “[The] passage of [the] federal budget with the absence of aggressive incremental revenue measures and slight relief for salaried and business is also well received by the investors.”
The National Assembly on Thursday passed the federal budget for the FY25-26, with an outlay of Rs17.57 trillion, despite opposition calls for the budgetary proposals to be made public and for the passage to be delayed until public input had been sought.
“The ceasefire between Iran and Israel has redirected investor focus toward improving macroeconomic fundamentals. Lower inflation and a record current account surplus are strengthening the case for a potential decline in interest rates to single digits,” Ashraf added.
He continued that stocks linked to the power sector and oil and gas exploration, along with those in their supply chains, are gaining momentum amid expectations of circular debt clearance before the fiscal year-end.
According to market experts, the Pakistan Stock Exchange benefited from clarity in economic policy and investor-friendly tax measures. The government’s decision to raise government salaries by 10% and pensions by 7% is expected to increase consumer spending, which could benefit businesses and improve company earnings.
One of the key reasons behind the rally was the budget’s neutral stance on stock market investments. The capital gains tax on equities was left unchanged, which signalled the government’s support for long-term investment in the Pakistan Stock Exchange.
The rebound followed a turbulent session on Thursday, when the benchmark index fell 715.18 points to close at 122,046.46 amid persistent selling and uncertainty surrounding the budget vote.
Earlier in the week on Tuesday, Pakistan Stock Exchange shares climbed by 6,079.16 points in the wake of US President Donald Trump announcing a complete ceasefire between Israel and Iran to end a 12-day war.
