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KARACHI: The surprising ceasefire turned a new page in Pakistan Stock Exchange (PSX) trading history on Monday as bulls went sentimental by staging an unprecedented relief rally, recovering more than what the benchmark KSE 100 index lost in the last one week amid tensions due to border hostilities between the two arch-rivals.
Topline Securities Ltd said the bulls came stampeding into the Pakistan Stock Exchange, torching the gloom with a historic 9.45pc rally — the biggest single-day surge the KSE-100 has ever witnessed. The benchmark index rocketed to an intraday high of 10,153 points before cooling slightly to close at a blazing 117,297, soaring 10,123 points as investor sentiment did a full 180 — flipping from panic to power in just a few days.
Across the border, Indian shares logged their best session in more than four years, surging nearly 4pc in a broad-based relief rally.
The Nifty 50 closed 3.82pc higher at 24,924.70 points and the BSE Sensex rose 3.74pc to 82,429.90, marking their biggest single-day gains since Feb 1, 2021.
The 9.45pc surge in a single day was the highest rise after 26 years. “Bullish sentiments and big buyers have triggered a market halt for an hour as the KSE 30 index went up by 5pc plus and the KSE 100 was up 9,475 or 9pc. This upside market halt has happened after 2 years,” said Topline Securities Ltd chief executive Mohammed Sohail.
He said, as per the Bloomberg report, the KSE-100 index is the third best-performing market in the last 12 months in the world. The market capitalisation rose from Rs12.9 trillion ($45.8bn) to Rs14tr ($49.8bn), an increase of 8.7pc day-on-day.
On early Wednesday, India launched a missile attack that resulted in the deaths of dozens of innocent civilians. In response, Pakistan shot down five of New Delhi’s fighter jets. However, the nuclear-armed neighbours avoided escalating into a full-fledged war after US President Donald Trump intervened. He engaged with both the political and military leaderships of India and Pakistan, urging them to refrain from violence. As a result of his mediation, President Trump announced on Saturday that India and Pakistan had agreed to an immediate and complete ceasefire.
Ahsan Mehanti of Arif Habib Corporation said stocks witnessed a historical surge led by scrips across the board amid a surprise ceasefire over Pakistan and India tensions and Trump’s offer to work for Kashmir’s solution and increase trade substantially.
He added that rise in global equities and global crude oil prices after the US trade deal with China, rupee stability amid IMF board approval on disbursement under EFF and RSF and monetary policy easing played a catalyst role in a record bullish close at PSX.
Topline noted that an immediate ceasefire led the unwavering optimism, approval of the first review of the $7bn Extended Fund Facility (EFF) programme by the IMF and unlocking $1bn tranche also boosted investors sentiments. Amidst the turmoil, the PSX lost 12.5pc over the following 12 sessions before recovering by 3.5pc on May 9.
The stand-off also clouded various positive developments, including an all-time low inflation reading of 0.3pc year-on-year and a surprise cut of 100bps in the policy rate to 11pc by the State Bank of Pakistan.
The stock market halted trading for an hour just five minutes after opening, with the index up by 9.26pc. According to PSX rules, trading will pause for one hour if the KSE-30 index moves 5pc in either direction and maintains that level for five consecutive minutes.
In total, 403 stocks closed in positive territory, out of which 279 stocks hit their upper circuit range of 10pc or Re1, whichever is higher.
However, the market witnessed a trading value of Rs30.4bn in the ready market, a meagre rise of 5.3pc over the preceding day.
Surprisingly, at the upper circuit, investor bids totalled Rs13bn in both ready and future markets, with the majority of interest seen in Pakistan Petroleum, Maple Leaf Cement, and PSO — attracting bids worth Rs2.2bn, Rs1.4bn, and Rs0.9bn respectively in both ready and futures market.
The most significant surge on the benchmark index came from Fauji Fertiliser, United Bank, Engro Holdings, Mari Energies, and Lucky Cement, which collectively added 3,003 points.
Bonds rally
After a week of market gloom driven by regional unrest, a surprise ceasefire breakthrough and a multi-billion-dollar IMF adrenaline shot served up a cocktail of catalysts that set the market ablaze. With diplomacy smoothing nerves and dollars flowing in, the PSX didn’t just bounce — it roared back to life, kicking off the week with renewed confidence.
Pakistan’s dollar bonds maturing in 2025 and 2026 increased by 1.2pc and 2.0pc, respectively. Similarly, yields on the 2025 and 2026 bonds have decreased to 9.93pc and 10.19pc, down from 13.27pc and 12.56pc on Friday.
Local bonds also posted a positive trend, with the 3-year bond yield falling by 8bps, while the 5-year yield declined by 15bps.
Published in Dawn, May 13th, 2025
