Karachi, January 2, 2026: The Pakistan Stock Exchange (PSX) continued its bullish run on Friday, surpassing the 179,000 mark for the first time, as investors positioned ahead of next week’s earnings and speculated on further monetary policy easing by the State Bank of Pakistan (SBP) following a softer December Consumer Price Index (CPI) reading.
The benchmark KSE-100 Index gained 2,679.44 points, or 1.52%, to close at 179,034.93, up from 176,355.49 in the previous session. Analysts attributed the rally to fresh buying by local institutions on new allocations, with particular interest in the fertiliser sector, according to Topline Securities.
Trading activity remained robust, with 1.11 billion shares changing hands in the ready market, valued at Rs64.34 billion. Market capitalisation rose to Rs20.21 trillion from Rs19.96 trillion a day earlier. Of 484 active stocks, 253 advanced, 201 declined, while 30 remained unchanged.
Pakistan’s headline CPI inflation eased to 5.6% in December, down from 6.1% in November, largely due to a sharp fall in perishable food prices, raising hopes for further SBP policy easing. On a month-on-month basis, consumer prices fell 0.4% in December, reversing a 0.4% increase in November. Despite easing, rising housing costs and sticky core inflation indicate continued pressure.
Positive liquidity and reserve flows supported the market sentiment. SBP data showed foreign-exchange reserves rose by $13 million to $15.915 billion in the week ending December 26, while total liquid reserves edged down $10 million to $21.012 billion and commercial-bank reserves fell $23 million to $5.097 billion.
Short-term local government bonds recorded a net $20 million foreign inflow in December, compared to $42.2 million outflows in November. Gross T-bill purchases stood at $77.29 million against divestments of $57.27 million as of December 25. Analysts noted that while 2025 flows were weak in the first half due to geopolitical concerns and competing yields, they stabilised in the second half as Pakistan’s risk premium eased and policy continuity improved.
The SBP cut its policy rate by 50 basis points to 10.5% in December after four consecutive meetings at 11%.
The KSE-100 delivered a total return of 51.2% in 2025, with banks leading at 103.8% (accounting for roughly 45% of index gains), followed by cement (88.1%), fertiliser (68.5%), power (62%), and chemicals (58.9%). Textiles and technology rose 27% and 26.5%, respectively, while food and autos were below 20%. Exploration and production gained 16.3%, pharmaceuticals and oil and gas were near 9%, and refineries ended flat.
On Thursday, the benchmark index closed up 1.32% at 176,355.49, after touching a then-record intraday high of 176,658.38.
