Karachi Stock Exchange Skyrockets 12,000 Points as War Tensions Ease in the Region
The Pakistan Stock Exchange recorded its highest-ever single-day gain on Wednesday, with the benchmark KSE-100 index zooming 12,000 points to reach a historic peak. The rally was triggered by a two-week ceasefire announcement between the U.S. and Iran, and rumors of a multi-billion-dollar "Special Investment Facilitation" deal being finalized with a Middle Eastern sovereign wealth fund.
- Republic Business
- 2 min read
Pakistan’s benchmark share index recorded its largest-ever single-day gain on Wednesday, surging by 12,000 points as a regional ceasefire and aggressive foreign buying triggered a massive short-covering rally across blue-chip sectors.
Sector-Wide Gains
The rally was fueled by institutional buying in high-weightage sectors. Heavyweight energy stocks, which have long been suppressed by circular debt concerns, led the charge as global oil price stability eased fears of rising import costs.
- Oil & Gas Development Co (OGDC): Surged 7.5% to hit its daily upper limit, closing at Rs 162.40.
- Pakistan Petroleum Ltd (PPL): Gained Rs 11.20 to settle at Rs 158.50, also hitting its circuit breaker within the first hour of trade.
- Commercial Banks: The banking index rose 12.2% overall. Habib Bank Ltd (HBL) and MCB Bank saw gains of 7.5% and 6.8% respectively, as investors bet on improving net interest margins and a stabilizing Rupee.
- Fertilizer Sector: Engro Corporation and Fauji Fertilizer (FFC) jumped 5.4% and 6.1%, supported by the SIFC’s recent push for agricultural investment.
Macroeconomic Headwinds
The surge comes at a critical time for Pakistan, which has been grappling with high inflation and a balance-of-payments crisis.12,000-point zoom was primarily a repricing of geopolitical risk. With the de-escalation of the Iran conflict, the cost of credit default swaps (CDS) for Pakistan is expected to tighten significantly.
Foreign institutional investors were net buyers for the fourth consecutive session, but it was the return of the local retail investor that drove the record volume. Daily turnover value crossed Rs 32 billion, compared to a monthly average of just Rs 12 billion. The "Single Window" facility for foreign investors and rumors of a $4 billion investment from a Middle Eastern sovereign wealth fund through the SIFC provided the technical floor for the surge.