The Pakistan Stock Exchange (PSX) staged a strong rebound on Tuesday, gaining nearly 1,200 points in early trading after the State Bank of Pakistan (SBP) decided to maintain the policy rate at 11%, in line with market expectations.
At 9:35am, the benchmark KSE-100 Index was up 1,195.58 points, or 0.74%, to trade at 163,359.39.
Buying interest was seen across major sectors including cement, commercial banks, oil and gas exploration companies, oil marketing, power generation, and refinery.
Index-heavy stocks such as HUBCO, POL, PPL, SSGC, MCB, MEBL, and UBL led the recovery, all trading in the green.
The rally comes a day after the Monetary Policy Committee (MPC) announced its decision to keep the policy rate unchanged at 11%, citing that headline inflation rose to 5.6% in September, while core inflation remained steady at 7.3%.
“The MPC assessed that the impact of the recent floods on the broader economy appears to be somewhat lower than anticipated at the time of its previous meeting,” the SBP said in a statement.
On Monday, the market had opened the rollover week on a bearish note as heavy selling and profit-taking dragged the KSE-100 down by 1,140.32 points, or 0.7%, closing at 162,163.81.
Analysts said the status quo in monetary policy boosted investor confidence, easing fears of tighter financial conditions and prompting a return of buyers to the market.
Globally, Asian markets consolidated recent gains on Tuesday amid optimism over easing global trade tensions and upcoming big-tech earnings. The Nikkei dipped 0.2% after a sharp 2.5% surge on Monday, while MSCI’s Asia-Pacific Index outside Japan slipped 0.1%.
Japan’s new Prime Minister Sanae Takaichi met with U.S. President Donald Trump in Tokyo to discuss trade, defence, and a $550 billion investment package agreed earlier this year.
Meanwhile, South Korea’s KOSPI fell 1.4% after a strong session on Monday, while Chinese blue chips were little changed.
In commodities, gold hovered around $4,000 an ounce, while the U.S. dollar steadied as investors awaited the Federal Reserve’s policy guidance.
Market participants expect the PSX to sustain its upward momentum in the near term, driven by stable monetary policy and easing inflationary concerns.
