KARACHI: The Pakistan Stock Exchange (PSX) experienced an upward trend on Friday, buoyed by solid corporate results, improved economic prospects, and investor confidence. The benchmark KSE-100 Index reached an intraday peak of 147,534.41 points, reflecting an increase of 1,005.11 points or 0.69%, before settling at a lower level of 146,894.62, down by 33.48 points or 0.02%.
Trading remained within a narrow range, with mutual fund activity and earnings reports providing support to market stability. According to independent analyst AAH Soomro, “The market has been range-bound lately, mainly driven by liquidity from mutual funds and the earnings season. Moody’s credit rating upgrade is already priced in.”
Samiullah Tariq, Head of Research at Pakistan Kuwait Investment Company, added, “Stronger corporate earnings and expectations of a more favorable economic environment are fueling investor optimism.” Notably, Moody’s recently upgraded Pakistan’s credit rating from Caa2 to Caa1, citing better external balances and reforms under the IMF’s Extended Fund Facility (EFF). The agency highlighted that foreign exchange reserves are likely to improve further, contingent upon timely external financing, and that the government’s efforts to broaden the tax base support fiscal stability. However, Moody’s warned that debt sustainability remains a challenge, and governance and political risks are still high.
This upgrade marks the third in four months, following similar ratings upgrades by S&P Global Ratings and Fitch Ratings, reflecting the government’s commitment to fiscal discipline and reforms under Prime Minister Shehbaz Sharif.On the international front, Pakistan is ranked first globally for equity returns in USD over FY24–FY25, according to Bloomberg data. For FY25 alone, the country ranks eighth worldwide but outperforms regional markets such as India (+3.2%), China (+14.8%), and other regional indices (+6%).
The State Bank of Pakistan’s (SBP) latest Monetary Policy Report projects GDP growth between 3.25% and 4.25% for FY26, with the current account deficit expected to stay within 0-1% of GDP. Despite keeping the policy rate steady at 11% in June and July, SBP aims to keep real interest rates positive to help control inflation. Reserves are forecasted to reach $15.5 billion by the end of December 2025, supported by expected inflows and ongoing foreign exchange purchases.
In the previous session, the KSE-100 index declined by 476.02 points, or 0.32%, closing at 146,529.31 points, after reaching a high of 147,892.25 and a low of 146,417.8.
