KARACHI: The Pakistan Stock Exchange (PSX) extended its upward momentum on Tuesday, with investor sentiment remaining positive despite the State Bank of Pakistan’s decision to raise the policy rate by 50 basis points to 12%.
Hopes of progress towards resolving the US-Israeli war on Iran, alongside a decline in international oil prices, supported buying activity as investors assessed the potential economic implications of easing regional tensions.
The benchmark KSE-100 Index opened strongly, gaining 875.75 points, or 0.54%, to reach 163,914.21 by 9:34am.
The rally continued during the session, with the index climbing to 164,068.67 by 12:54pm, an increase of 1,030.21 points, or 0.63%.
KSE-100 Index Maintains Upward Momentum
During Tuesday’s trading, the benchmark index touched an intraday high of 164,368.47 and a low of 163,545.69.
Trading volume reached 63.83 million shares, while turnover stood at Rs4.96 billion.
Buying interest was visible across several major sectors, including cement, commercial banks, oil and gas exploration companies, and oil marketing companies. Activity in these sectors helped support the broader market’s advance.
The gains came despite the central bank’s decision to increase its policy rate by 50 basis points, taking it to 12%. Investors appeared to focus instead on developments that could ease regional uncertainty and pressure on energy prices.
PSX Falls 715 Points as Investors Await State Bank Policy Rate Decision
Global Oil Prices Edge Lower
International oil prices declined by approximately 1% as hopes of a resolution to the US-Israeli war on Iran eased immediate concerns about potential supply disruptions.
Brent crude fell 0.86% to $114.81 per barrel, while US West Texas Intermediate crude declined by 0.86% to $100.88 per barrel.
Lower oil prices can offer some relief to oil-importing economies such as Pakistan by reducing potential pressure on the import bill and inflation, although the overall impact depends on the duration and scale of the decline.
However, renewed Houthi attacks on Saudi Arabia kept geopolitical risks in focus, highlighting the continued uncertainty surrounding regional energy supplies.
Investors Monitor Economic and Regional Developments
The stock market’s performance reflects the competing factors shaping investor sentiment, including monetary policy, energy prices and developments in the Middle East.
While the interest rate increase could affect borrowing costs and business activity, hopes of reduced regional tensions provided a more supportive backdrop for equities during Tuesday’s session.
Investors will continue to monitor oil prices, regional security developments and Pakistan’s economic outlook for signals that could influence market direction in the coming sessions.
