Pakistan Stock Exchange Reaches Record High Amid Positive Investor Sentiment

On December 26, 2025, the Pakistan Stock Exchange (PSX) achieved a historic milestone as the benchmark KSE-100 Index closed at an all-time high of 172,400.73 points, marking an increase of 1,570.51 points or 0.92% from the previous close. The trading session was characterized by strong buying interest, particularly in heavyweight stocks, which drove the index to an intra-day peak of 172,582.95 points. This surge followed a week of subdued trading, where the index experienced a decline of 243.51 points earlier in the week due to cautious sentiment during the roll-over period.

PSX closes week at record high as KSE-100 gains over 1,500 pointsExpress TribuneDawn

The significant rise in the KSE-100 Index was bolstered by several factors. Notably, the privatization of Pakistan International Airlines (PIA) was highlighted as a pivotal event, enhancing investor confidence in the market. The airline's plans to reclaim valuable slots at London’s Heathrow Airport and resume flights to the UK by March-April 2026 were seen as steps toward its revival. Additionally, the Asian Development Bank (ADB) approved a $730 million financing package aimed at supporting a critical power transmission project and reforms in state-owned enterprises, further reinforcing positive sentiment among investors.

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The market rally was significantly supported by key players such as Engro Holdings, Pakistan Petroleum, and Systems Limited, which collectively contributed approximately 775 points to the index's gains. Despite this, some stocks like Lucky Cement and Millat Tractors exerted downward pressure, collectively subtracting 133 points from the index. Overall, 221 shares closed higher while 229 declined, reflecting a mixed performance across the board.

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Trading volume on the day reached 798 million shares, a slight decrease from the previous session's 812 million shares. The total traded value surged by 27.74% to Rs38 billion, with WorldCall Telecom leading the volume chart at over 79.3 million shares traded. Analysts expressed optimism regarding the market's momentum, suggesting that the closing above the 172,000-point mark could indicate further upward movement in the coming sessions, provided that the critical support level of 170,000 points remains intact.

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Despite the positive outlook, some analysts cautioned that the market's gains primarily benefit existing shareholders, as foreign funds may divert their liquidity into purchasing stocks, potentially inflating share prices without addressing underlying economic challenges. The ongoing rise in the Sensitive Price Index (SPI), which recorded a 2.83% year-on-year increase for the week ending December 25, raises concerns about inflationary pressures that could impact consumer spending and overall economic stability.

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As the market moves into the next week, participants remain hopeful for continued growth, contingent on maintaining positive catalysts. The developments surrounding PIA and the ADB financing are expected to play crucial roles in shaping investor sentiment and market dynamics.

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