In a dramatic start to the week, Pakistan’s stock exchange was forced to halt trading for an hour after its benchmark KSE-100 index soared by 8.84% during early trading, triggering regulatory circuit breakers, according to a report by India Today.
The sharp rally was driven by a combination of easing geopolitical tensions and positive economic developments. The recent four days of heavy cross-border shelling between Pakistan and India came to an unexpected halt over the weekend following a surprise ceasefire agreement.
The ceasefire has been widely welcomed as a de-escalation of the most intense fighting between the nuclear-armed neighbours in nearly three decades.
According to a notification issued by the Pakistan Stock Exchange (PSX), all equity and equity-based markets were temporarily suspended after the KSE-30 index rose by more than 5% from the previous session’s close — the threshold that mandates a market halt under PSX regulations.
“The market has reacted jubilantly to the ceasefire announcement after Pakistan established effective deterrence against India,” said Yousuf M Farooq, Research Director at Chase Securities, as quoted by Dawn.
“The PSX has saluted the Pakistan Air Force this morning with a surge of over 9 per cent in the KSE-100 Index,” he added, referencing the PAF’s retaliatory operations in response to Indian military strikes earlier in the week.
In addition to the ceasefire, Farooq also highlighted recent domestic economic developments that contributed to investor optimism. These include a cut in the benchmark interest rate and the approval of a $1 billion tranche by the International Monetary Fund (IMF) as part of Pakistan’s ongoing financial support programme.
The combination of geopolitical relief and positive economic indicators triggered a wave of investor confidence, resulting in one of the strongest single-session rallies in recent PSX history.
