The Pakistan Stock Exchange (PSX) witnessed a robust rally on Thursday as bullish sentiment took hold of the market, leading to a significant surge of over 600 points during intraday trading. This upward trend in equities was largely fueled by positive investor expectations surrounding the upcoming federal budget and encouraging corporate earnings.
The benchmark KSE-100 index, which tracks the performance of the top companies listed on the PSX, gained 638.5 points, reflecting a 0.54 percent increase. It closed at 118,971.40, up from the previous session’s close of 118,338.90. At one point during the day, specifically at 1:45 pm, the index had peaked even higher, rising by 1,298.02 points, indicating strong market momentum before settling.
Market analysts have attributed this strong performance to optimism about the federal budget, which investors anticipate will offer favorable policy measures. Samiullah Tariq, Head of Research and Development at Pak Kuwait Investment Company Ltd, stated that the market is responding positively to better expectations from the upcoming budget. He noted that improved corporate financial results have further reinforced investor confidence.
Adding to the anticipation, the government has postponed the presentation of the federal budget from its earlier scheduled date of June 2 to June 10. The delay stems from ongoing and inconclusive discussions with the International Monetary Fund (IMF) over key issues, particularly taxation and fiscal reforms. These negotiations are crucial for securing further financial assistance under the IMF program.
According to insiders, the IMF delegation currently in Pakistan has held several rounds of discussions with top government officials. A critical wrap-up meeting was conducted with Finance Minister Muhammad Aurangzeb, who is expected to lead the government’s fiscal policy announcements in the upcoming budget session. While no conclusive agreement has yet been reached, the dialogue is continuing in a bid to find common ground on essential economic policies.
The anticipation of an IMF-aligned budget and the potential for pro-business policy announcements have created a wave of optimism in the local bourse. Investors are positioning themselves ahead of the budget, which is expected to address key macroeconomic challenges, offer clarity on tax reforms, and support growth-oriented sectors.
The current rally also reflects the resilience of the Pakistani equity market, which continues to respond to policy signals and macroeconomic indicators. While delays and negotiations with the IMF present an element of uncertainty, the general investor sentiment remains cautiously optimistic. Market watchers believe that if the upcoming budget manages to strike the right balance between fiscal discipline and economic stimulus, the PSX could maintain its upward trajectory in the near term.
In the broader context, this market activity highlights how investor confidence in fiscal policy and corporate performance continues to play a pivotal role in driving stock market movements in Pakistan. With budget season approaching, all eyes will be on Islamabad as investors and financial institutions await critical policy announcements that could shape the economic landscape for the year ahead.