KARACHI:
Pakistan Stock Exchange (PSX) extended its winning streak on Tuesday, holding firmly in positive territory throughout the session, as broad-based buying in heavyweight sectors lifted market mood. Investors seemed to have moved past the State Bank of Pakistan’s (SBP) latest rate hike as softer international oil prices and hopes of progress in resolving the US-Israel conflict with Iran sparked interest.
The benchmark KSE-100 index maintained its upward trajectory after a strong opening, where stock buying gathered pace in cement, commercial banks, oil and gas exploration and oil marketing sectors. The market’s advance reflected investors’ willingness to keep their exposure to equities despite a tighter monetary policy.
The index added 1,428.73 points, or 0.88%, to settle at 164,467.20. During the session, it touched the high of 164,787.67 and low of 163,545.70, remaining in the green throughout the day.
Meanwhile, international oil prices fell amid expectations of easing of hostilities in the Middle East, but persistent attacks on key producer Saudi Arabia and maritime shipping kept investors wary and prices near six-month highs. The combination of positive factors allowed the benchmark index to extend gains despite worries about implications of the higher policy rate for businesses and economic activity.
“The market witnessed a positive session, primarily supported by buying interest in commercial banks, cement, fertiliser and automobile sectors,” remarked Ahmed Sheraz, equity trader at KASB KTrade. MCB Bank, Fauji Fertiliser, UBL, Pakistan Petroleum and NBP were among the key contributors to the market’s performance.
“Additionally, with the ongoing corporate results season, stock-specific activity continues to drive investor flows, leading to selective buying despite broader macroeconomic concerns,” he said. “However, there is a cautious outlook amid geopolitical uncertainty in the Middle East, Israeli elections and the upcoming US midterm polls.”
Brent crude traded around $115-116 a barrel, which sparked fears about imported inflation, while domestic price pressures and the increase in the SBP policy rate to 12% may continue to weigh on investor sentiment. “Going forward, the market is expected to maintain a mixed-to-cautious stance, with corporate earnings, oil prices, geopolitical developments and macro indicators dictating direction. Selective, stock-specific activity may lend support to the index, although volatility is expected to stay elevated,” Sheraz said.
According to Ali Najib of Arif Habib Limited (AHL), the market opened on a strong note, remained in positive territory throughout the session and closed near its intra-day highs. The rally was primarily driven by investor relief following the SBP’s moderate 50-basis-point rate hike, which was lower than an aggressive 100bps increase anticipated by some market participants while considering the geopolitical situation, global oil prices and their impact on domestic inflation.
Sentiment was further supported by easing geopolitical concerns amid diplomatic efforts by the Makkah alliance countries, including Pakistan, Saudi Arabia and Turkiye, as officials held high-level talks in Iran to explore a peaceful resolution to the ongoing US-Iran conflict. On the macroeconomic front, the SBP reported cumulative net foreign exchange interventions of $17.2 billion between Jun’24 and Jul’26, including $863 million in Jul’26, highlighting its continued management of forex market liquidity and reserve accumulation.
Cumulatively, trading volumes increased to 402 million shares versus Monday’s total of 376 million. The value of traded shares stood at Rs18 billion.
Shares of 497 companies were traded in the ready market. Of these, 282 stocks closed higher, 170 fell and 45 remained unchanged.
