KARACHI — The Pakistan Stock Exchange (PSX) kicked off the trading week on a record-breaking note on Monday, with the benchmark KSE-100 index soaring more than 7,200 points and crossing the 178,000 mark for the first time. The massive rally came after a temporary de-escalation in US-Iran military strikes, which helped ease global oil prices and boosted investor confidence in domestic equities.
The KSE-100 opened on a strong note, adding 4,501.33 points in the early hours. Buying momentum intensified as the session progressed, pushing the index to an intraday high of 178,588.33 points. It eventually closed at 178,262.33 points, registering a single-day gain of 7,241.13 points, or 4.23 percent.
Oil prices fell 4% on Monday after the US and Iran paused military strikes over the weekend, raising hopes of de-escalation. Brent crude dropped to $92.82 and US WTI fell to $85.29 a barrel. Despite the pause, Strait of Hormuz traffic stayed low and Red Sea shipping slowed… pic.twitter.com/oLMzGe3tOL
— Sarmaaya Financials (@sarmaayapk) July 27, 2026
Key Drivers
Analysts attributed the sharp rally to a combination of positive international and domestic factors that helped ease the heavy pressure seen in the previous week:
| Catalyst | Market Impact & Key Metrics |
|---|---|
| Middle East De-escalation | Pause in US-Iran strikes improved prospects for smooth transit through the Strait of Hormuz. |
| Global Oil Price Drop | Brent crude fell over 7% below $90/barrel; US WTI dropped 4% to $85.45/barrel. |
| SBP Policy Rate Decision | State Bank of Pakistan kept the benchmark policy rate unchanged at 11.5%. |
| Top Index Contributors | UBL, FFC, ENGROH, MEBL, and LUCK together added 2,546 points to the rally. |
Awais Ashraf, Director of Research at AKD Securities, said the State Bank’s decision to hold the policy rate steady reflected a cautious approach while monitoring geopolitical developments and the impact of recent floods. He noted, however, that ongoing disinflation, a stable external account, and contracting money supply continue to support expectations of monetary easing in future cycles.
Market Recovery Following Previous Week’s Slide
Monday’s strong performance provided much-needed relief after the KSE-100 index lost 4,782 points (2.7 percent) last week amid rising Middle East tensions and volatile energy prices. Investors took advantage of attractive valuations, setting aside earlier geopolitical concerns and responding positively to Pakistan’s improved sovereign credit outlook.
