Bulls roar at PSX, KSE-100 settles with 2.7% gain on US-Iran peace deal announcement

The Pakistan Stock Exchange (PSX) witnessed a strong bullish session on Monday, with the benchmark KSE-100 Index gaining over 4,600 points or 2.7%, as investor sentiment improved amid easing geopolitical concerns following the announcement of a US-Iran peace deal.

During the trading session, the index remained volatile during the early hours of trading, opening on a positive note before witnessing profit-taking that dragged it to an intra-day low of 175,085.79 points.

However, buying momentum strengthened in the second half of the session, allowing the benchmark to recover sharply and hit an intra-day high of 177,176.72 points.

At close, the benchmark index settled at 177,039.82, up by 4,639.92 points or 2.69%.

“A broad ‘all is well’ sentiment prevailed at the PSX, as market participants welcomed the government’s reform-oriented budget measures and responded positively to reports of a preliminary peace agreement between the United States and Iran, which also eased concerns over global oil supply disruptions,” brokerage house Topline Securities said in its post-market report.

On the index contribution front, index heavyweights UBL, HUBC, LUCK, ENGROH, and FFC emerged as the primary drivers of upside momentum, collectively contributing 1,790 points to the benchmark’s gain, Topline said.

The Monetary Policy Committee (MPC) of the State Bank of Pakistan (SBP) decided to keep the policy rate unchanged at 11.5%.

During the previous week, the KSE-100 Index gained 1.1% despite sharp volatility and briefly falling below the key 170,000-point level, as easing tensions between the United States and Iran and declining international oil prices improved investor sentiment and revived risk appetite. The benchmark index advanced 1,921 points, or 1.13%, on a week-on-week basis to settle at 172,399.90 points.

On Friday, Finance Minister Muhammad Aurangzeb unveiled Pakistan’s federal budget for fiscal year 2026-27, with the government seeking to achieve GDP growth of 4% and inflation at 8.2%.

Share markets surged in Asia on Monday, while the dollar slipped and oil prices tumbled, as a tentative peace deal between the United States and Iran promised to ease inflationary pressures globally and reduce the need for higher interest rates.

Pakistani Prime Minister Shehbaz ‌Sharif said on social media early on Monday that a deal had been struck, while President Donald Trump said the agreement included opening the vital Strait of Hormuz, though without giving details.

Trump will meet with Middle Eastern leaders and attend a working session with Ukrainian President Volodymyr Zelenskiy during a G7 summit in France this week.

Iran said traffic through the strait would be regulated by it and Oman, a ​potential blow to the rules of free trade and suggesting there might be some sort of toll on shipping.

The news will be a relief for the crowd of central banks meeting this week, easing some of the pressure to tighten policy to head off ​an energy-driven rise in inflationary expectations.

Markets had already priced in a likely deal, but the confirmation was enough to send Brent crude falling 4% to $83.80 a barrel, well away from its May peak of $126.41. U.S. crude slid 4.7% to $80.89 a barrel, but was still above the $67 level it traded at before the war began.

Meanwhile, the Pakistani rupee gained against the US dollar in the inter-bank market on Monday. At close, the local currency settled at 278.31, a gain of Re0.01 against the greenback.

Volume on the all-share index rose to 988.08 million from 890.79 million recorded in the previous close.

The value of shares increased to Rs63.48 billion from Rs41.98 billion in the previous session.

Kohinoor Spining was the volume leader with 64.13 million shares, followed by Maple Leaf with 45.55 million shares, and B.O.Punjab with 38.64 million shares.

Shares of 494 companies were traded on Monday, of which 349 registered an increase, 119 recorded a fall, and 26 remained unchanged.