KSE-100 Index Soars Past 124,000 Mark Amid Post-Budget Rally
The Pakistan Stock Exchange (PSX) continued its bullish streak on Tuesday, with the benchmark KSE-100 Index surging 2,328.24 points, or 1.91%, to close at an all-time high of 124,352.68. During the day, the index peaked at 124,588.17, breaking previous records and reflecting strong market confidence.
The rally comes just a day after the announcement of Pakistan’s federal budget for FY2025–26, which has been received positively by investors and business leaders alike.
Trading Snapshot
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KSE-100 Close: 124,352.68 (+2,328.24 points)
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Intraday High: 124,588.17
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Volume: 332.58 million shares
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Total Value: Rs31.89 billion
Robust trading volumes and value indicate broad-based participation and strong momentum in blue-chip and mid-cap stocks alike.
Investor Optimism Fueled by Pro-Growth Budget
Finance Minister Muhammad Aurangzeb unveiled a Rs17.6 trillion federal budget on Monday, focusing on economic stability, fiscal consolidation, and growth stimulation.
Key highlights supporting the market rally include:
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Improved macroeconomic indicators:
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Remittances projected to hit $37–38 billion
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Inflation down to 4.7%
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GDP growth currently at 2.7%
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Public Sector Development Programme (PSDP) allocation:
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Rs1 trillion for federal PSDP
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Rs2.869 trillion for provincial ADPs
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Rs355 billion from SOEs’ own resources
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Total development spending: Rs4.224 trillion
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These measures signal strong public investment, which often translates into improved corporate earnings, especially in construction, energy, and infrastructure-linked sectors.
Budget 2025–26 Economic Targets
The government has set ambitious but grounded macroeconomic targets for FY2025–26:
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GDP Growth: 4.2%
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Inflation: 7.5%
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Interest Rates: 7.5%
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Budget Deficit: 3.9% of GDP
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Primary Surplus: 2.4% of GDP
These targets reflect a policy mix aimed at lowering borrowing costs and stimulating private sector investment, both key for sustaining stock market gains.
Sector Watch: Real Estate vs. Digital
Although the broader market has rallied, sectoral divergence remains a point of focus. As highlighted in our earlier analysis, the federal budget favors traditional sectors like real estate and manufacturing, while providing limited support for the digital economy or startups.
This has led to sharp gains in cement, steel, and construction-linked stocks, while tech-sector sentiment remains neutral to cautious.
What This Means for Investors
The historic PSX rally underscores renewed investor confidence driven by:
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Political and fiscal stability signals
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Improved macroeconomic environment
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Targeted government spending
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Rising foreign remittances and easing inflation
Analysts caution, however, that sustaining momentum will depend on:
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Execution of budgetary commitments
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IMF program clarity
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Stability in interest rates
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Global economic conditions
Outlook: PSX in Uncharted Territory
As the KSE-100 enters uncharted territory, the focus will shift to corporate earnings and the government’s follow-through on development pledges.
With Pakistan aiming for 4.2% growth and lower inflation, the market appears to be positioning for a medium-term bull run—a trend that could draw more institutional and foreign capital inflows in the months ahead.
