The equity market edged higher on Tuesday as risk appetite improved on signs of US-Iran nuclear talks and a benign inflation print, with selective institutional buying lifting the market ahead of results season.
"The market staged a healthy recovery as investor confidence improved, aided by a positive geopolitical situation, and selective buying, which led to higher institutional inflows," said Huzaifa Riaz, Director, Mayari Securities (Pvt) Limited.
"January CPI at 5.8% further validated the view that the path to inflation remains positive for equities," he added.
The Pakistan Stock Exchange's (PSX) benchmark KSE-100 Index settled at 186,900.73 points, up 1,842.9 points, or 1%, from 185,057.83.
The index traded between an intraday high of 187,518.78 (up 2,460.95 points, or 1.33%) and a low of 185,545.92 (up 488.09 points, or 0.26%).
In a lift to investor sentiment, Iranian President Masoud Pezeshkian said he had ordered the start of talks with the United States on the nuclear issue, responding to regional requests as Washington kept naval assets deployed. Both sides signalled space for diplomacy.
In a further boost to confidence, Pakistan’s Consumer Price Index (CPI) edged up to 5.8% in January from 5.6% in December but remained within the State Bank of Pakistan (SBP)’s 5–7% target band. On a month-on-month basis, CPI rose 0.4% after a 0.4% decline in December. For Jul–Jan (7MFY26), average inflation printed 5.24% (against 6.5% a year earlier).
Upstream pressures eased with the Wholesale Price Index (WPI) averaging 0.29% in 7MFY26 (against 3.83% in 7MFY25) and fell 0.2% MoM in January after 0.6% in December, signals that could feed through to retail prices with a lag, barring energy-price shocks.
On Monday, the KSE-100 rose 883.35 points (0.48%) to 185,057.83, trading between 185,611.73 and 182,792.40.
