KARACHI: Anticip­ation of an interest rate cut at the upcoming monetary policy meeting continued to fuel broad-based value hunting on Tuesday, as investors brushed aside a widening current account deficit and a sharp fall in foreign investment to propel shares to yet another record.

The benchmark KSE-100 index crossed the 188,000-point barrier for the first time, extending its overnight rally. According to Topline Securities Ltd, the index closed at 188,621.78 points, up 860.09 points or 0.46 per cent, after a volatile session in which it touched an intraday high of 188,958.38 and a low of 187,192.02.

The brokerage attributed the upward momentum primarily to buying by local mutual funds.

Engro Holdings, Pak­istan Petroleum, Sazgar Engineering Works, Oil and Gas Development Company and PSO collectively added 661 points to the index. However, losses in Meezan Bank, Hub Power and United Bank partly offset the gains, dragging the benchmark down by 249 points.

Overall market activity remained healthy, with trading volume rising 2.26pc to 1.22 billion shares, while traded value increased 1.5pc to Rs63.8bn. Hascol Petroleum led the volume chart with 113 million shares.

Meanwhile, Pakistan posted a current account deficit of $244 million in December 2025, reversing surpluses of $454m in December 2024 and $98m in November 2025. During the first half of FY26, the current account recorded a deficit of $1.174bn, compared with a surplus of $957m in the same period last year. The country also saw a net foreign direct investment outflow of $135m in December.

Ali Najib, deputy head of trading at Arif Habib Ltd, said the Pakistan Stock Exchange extended its bullish momentum, with the index hitting another all-time high.

“The session witnessed a tug of war between bulls and bears; however, bulls eventually dominated, enabling the market to close on a positive note,” he said, adding that sentiment remained buoyant despite selective profit-taking.

On the IPO front, the Signature Residency Developmental REIT Scheme, comprising residential and commercial components, was oversubscribed, signalling strong investor appetite.

Market participants expect the rally to continue, supported by expectations of monetary easing and improving corporate earnings, though near-term volatility may persist, with dips offering selective buying opportunities.

Published in Dawn, January 21st, 2026