KARACHI: The KSE 100 index closed up 796 points at 156,467 on Tue­s­day, as a positive economic outlook lifted market sentiment, as investors rea­c­ted favourably to the State Bank of Pakistan’s (SBP) latest remarks on the flood crisis and the broader economic environment.

The SBP’s in its monetary policy statement provided reassurance, stating that while the flood situation remains ongoing, its economic impact has been notably less severe than past crises. This, coupled with the central bank’s decision to keep the policy rate at 11pc, bolstered conf­idence in Pakistan’s economic resilience. Ana­l­y­sts viewed the SBP’s cautious stance as a sign of stability amid ongoing challenges, including the climate crisis.

According to Topline Securities, investor optim­i­sm was further supported by the normalisation of the Margin Trading Syst­­em (MTS) rate to 14.95pc, which provided relief to leveraged investors and improved market liquidity. Speculation aro­und the resolution of the circular debt issue also contributed to the positive mood, especially within the ene­r­gy sector, where stocks like Oil and Gas Devel­o­p­ment Com­pany, Pakistan Petro­l­e­um, and Pakistan State Oil (PSO) saw notable gains.

The index reached an intraday high of 1,083 points before settling at a 796-point gain, with key movers like Meezan Bank, TRG Pakistan, Hub Power, and OGDC adding 403 points to the overall rise. However, profit-taking in stocks such as Fauji Fert­i­l­iser, MCB Bank, Askari Bank, and Bank Alfalah offset some of the gains, trimming 172 points from the index.

Trading activity was ro­bust, with total volume rising 58.11pc to 1.345bn shares, and the traded value increasing 32.25pc to Rs43.27bn. WorldCall Telecom led the volume chart, trading 125.6m shares.

Ali Najib, Deputy Head of Trading at Arif Habib Ltd, noted that while inv­e­stors were optimistic, they remained cautious, refle­cting confidence in the SBP’s policy stance and the country’s imp­roved economic fundamentals. Looking ahead, analysts expect the market to consolidate bet­ween the 155,000-158,000 range, with the 154,000 level providing support against potential profit-taking.

Published in Dawn, September 17th, 2025