KSE-100 Index Climbs to Historic High as Confidence Surges

The Pakistan Stock Exchange (PSX) ended the week on a historic note. The benchmark KSE-100 index jumped 4,220 points, or 2.67% week-on-week. It closed at an all-time high of 162,257.
Market enthusiasm rose due to three major factors. First was the landmark Rs1.225 trillion circular debt settlement. Second was the strengthening of external accounts.
Third was renewed investor confidence after Prime Minister Shehbaz Sharif’s meeting with US President Donald Trump in Washington. As a result, banking, cement, fertiliser, and power stocks led the rally. Expectations of IMF-related disbursements added further momentum.
Trading began weak on Monday, when the index lost 483 points to close at 157,555. However, recovery followed quickly. On Tuesday, the KSE-100 gained 390 points to 157,945.
On Wednesday, it added another 292 points, closing at 158,237. Thursday saw a strong rally, lifting the index past the 159,000 mark to 159,208. The week ended with an exceptional surge of 2,977 points. This pushed the KSE-100 to its record level.
Arif Habib Limited (AHL), in its weekly review, noted that the market’s performance was reinforced by the White House meeting on September 25. The meeting came soon after a US business delegation visited Pakistan. During that visit, MoUs were signed for the development of critical minerals, including rare earths.
The circular debt agreement, signed on September 24, also played a key role. It will allow banks to extend financing at Kibor minus 0.9%. This step is expected to ease energy sector challenges significantly. Circular debt stood at Rs1.6 trillion in July 2025. That figure was down from Rs2.3 trillion a year earlier.
Meanwhile, foreign exchange reserves climbed to $19.79 billion. August crude imports fell 16.3% year-on-year due to softer prices and weaker demand. However, petroleum product imports rose by 3.8%.
The bullish rally strengthened PSX’s standing as one of Asia’s most attractive emerging markets. Investors are now eyeing further gains in the near term.