The Pakistan Stock Exchange (PSX) rebounded sharply on Friday, closing above the 185,000 mark as risk appetite returned owing to easing US–Iran tension and an anticipated rate cut.
The benchmark KSE-100 Index settled at 185,098.83 points, adding 3,642.5 points, or 2.01%, at the closing of the market, compared with the previous closing of 181,456.34.
The positive sentiments during today's session can be attributed to buying by local institutions, an analyst at Topline Securities said.
Traded volume stood at 959.5 million shares, while the value for the session stood at Rs69.3 billion.
"Top positive contribution to the index came from OGDC, PPL, HUBC, ENGROH, FFC, UBL & MEBL, as they cumulatively contributed +1,725 points to the index," the analyst added.
The benchmark index had surged to an intraday high of 184,787.27, gaining 3,330.94 points, or 1.84%, and reached a low of 182,559.69, up 1,103.36 points, or 0.61%.
"The market witnessed a sharp recovery after the latest news flows suggest the de-escalation between the US and Iran," said Huzaifa Riaz, Director, Mayari Securities (Pvt) Limited.
Ahsan Mehanti, Managing Director and CEO of Arif Habib Commodities, echoed the sentiments, saying: “Bullish activity witnessed in early session at PSX amid reports of US-Iran de-escalation," adding: "Speculations over further SBP policy easing amid falling government bond yields played a catalyst role in bullish activity at PSX.”
A Topline Research survey ahead of the State Bank of Pakistan (SBP) Monetary Policy Committee meeting on January 26, 2026, showed 80% of participants expect a rate cut.
Of those, 56.4% see 50 bps, 15.4% expect 100 bps, 5% look for 25 bps, and 3% foresee 75 bps, while 20% expect no change. In the previous decision on December 15, 2025, the SBP cut 50 bps.
SBP reserves rose $16 million to $16.072 billion in the week ended January 9, taking total liquid reserves to $21.248 billion (commercial banks $5.177 billion, up $40 million).
The SBP noted ongoing foreign exchange purchases amid a steadier current account supported by remittances; from June 2024 to September 2025, net market purchases totalled $9.7 billion.
The central bank projects the FY26 current account deficit at 0–1% of GDP and sees reserves at $17.8 billion by June 2026 with planned official inflows.
On Thursday, the KSE-100 Index fell 1,113.48 points (0.61%) to 181,456.34 from 182,569.82, after trading between 183,717.54 and 180,783.63.
