The Pakistan Stock Exchange (PSX) witnessed a powerful rally on Wednesday as the KSE-100 Index soared over 2,300 points during intra-day trading, crossing the 124,000 mark — a historic high that signaled investor confidence following the presentation of the federal budget for 2025-26.
By 12:05 PM, the benchmark index had reached 124,325.49 points, reflecting a 1.89% increase from the previous close. The surge was driven by broad-based buying across major sectors including banking, cement, automobile assemblers, power, and oil and gas exploration. Key index movers such as HUBCO, OGDC, PSO, PPL, POL, HBL, MCB, MEBL, and UBL all traded in the green.
Market sentiment was largely buoyed by the absence of major tax hikes in the federal budget, particularly the decision to retain the capital gains tax on dividends at 15%. Samiullah Tariq, Head of Research at Pak Kuwait Investment Company, noted that the market welcomed the budget’s continuity and stability signals.
Finance Minister Muhammad Aurangzeb unveiled a Rs17.573 trillion federal budget on Tuesday, setting ambitious targets including 4.2% GDP growth, 7.5% inflation, and a reduction in the fiscal deficit to 3.9% of GDP. He described the budget as the first step in transforming Pakistan into a more productive and export-oriented economy.
Globally, investor mood was cautious. Asian markets made modest gains after US-China trade talks yielded a preliminary framework, but lacked specific commitments. Meanwhile, investors awaited critical US inflation data and a major Treasury bond auction that could reflect the impact of tariffs on pricing.
Despite international uncertainties, the PSX rally reflects optimism in domestic policy direction. However, sustained growth will depend on macroeconomic stability, successful reform implementation, and favorable external conditions in the months ahead.
