• KSE-100 index jumps 9.32pc; Rs1.47tr added to market capitalisation
• Investor sentiment shifts sharply to optimism
• Falling oil prices ease macroeconomic concerns
• Banking, energy, fertiliser stocks attract heavy buying

KARACHI: A fragile two-week ceasefire between the United States and Iran, brokered by Pakistan, ignited a historic rally at the Pakistan Stock Exchange (PSX) on Wednesday, as investors rushed to reprice geopolitical risk and capitalise on attractive valuations.

The benchmark KSE-100 index surged by 14,138 points, or 9.32 per cent, to close at 165,811 — marking the largest single-day gain in the index’s history. The market also touched an intraday high with gains of over 14,250 points, recovering Rs1.467 trillion in market capitalisation.

According to the brokerage house Topline Securities, the equity market rebounded sharply as news of the ceasefire boosted investor confidence. With Islamabad set to host US-Iran talks on April 10, sentiment shifted rapidly from caution to optimism.

The rally gathered pace as international oil prices declined, easing macroeconomic concerns and strengthening risk appetite. Heavy buying was observed in cyclical stocks, reflecting renewed investor confidence.

Trading was briefly halted due to a circuit breaker after a sharp early surge, but resu­med with stronger momentum, und­­e­­rscoring the bullish sentiment.

Market heavyweights, including United Bank, Fauji Fertiliser Company, Engro Holdings, Hub Power, Oil and Gas Development Company and Meezan Bank, led the rally, contributing 4,538 points to the index’s rise.

Arif Habib Ltd Deputy Head of Trading Ali Najib said the market opened strongly, gaining nearly 8pc in early trade following the geopolitical breakthrough. He noted that the ceasefire and planned talks enhanced Pakistan’s reg­i­o­nal standing while improving prospects for stability.

The sharp rebound follows an estimated 10pc market correction since late February, when escalating tensions had weighed on equities and pushed valuations of key stocks to attractive levels.

Trading activity remained robust, with total volume surging by 248.5pc to 1.24 billion shares and turnover rising 166.2pc to Rs54.4bn. Fauji Foods Ltd topped the volumes chart, with over 212 million shares traded.

Analysts said the rally reflected a convergence of easing geopolitical tensions and improving macroeconomic indicators, which together reignited investor interest.

They added that continued de-escalation or a formal settlement could further stabilise global commodity prices, particularly oil, thereby easing inflationary pressures and supporting a sustained recovery in the equity market.

Recent geopolitical volatility and sharp fluctuations in international oil prices had overshadowed positive developments that took place last week, including lower-than-expected inflation and Pakistan securing a staff-level agreement with the IMF for $1.2bn disbursement.

These gains were earlier offset by conflicting signals from Iran and the US and fears of further escalation. Following Wednesday’s rally, the index narrowed its gap with the Jan 23 all-time high of 189,166.83 points. However, it still remains around 23,355 points below its peak.

Momentum was widespread as 130 stocks hit the 10pc upper cap, reflecting a strong return of risk appetite. On March 2, in its first trading session after the US-Israel attack on Iran on Feb 28, the KSE-100 index had recorded its largest single-day decline of 16,089 points, or 9.57pc, to close at 151,973 points.

Published in Dawn, April 9th, 2026