Karachi: The Karachi Stock Exchange experienced a bullish week, with the KSE-100 Index gaining 8,122 points, or 5.0% week-on-week, to close at 171,116 points on Friday. Despite a decrease in average daily trading volumes by 9.7% to 1.1 billion shares, the easing of Iran-US tensions played a significant role in driving market sentiment.
According to AKD Securities Limited, the recent developments in the geopolitical landscape included a reported move towards a short-term memorandum between the United States and Iran to halt ongoing conflicts, which subsequently led to an 18% weekly decrease in international oil prices to $100.5 per barrel. Earlier in the week, U.S. President Donald Trump paused the 'Project Freedom' naval operation in the Strait of Hormuz, following a request from Pakistan and other mediating nations, citing progress towards a final agreement with Tehran. Despite some exchanges of fire between U.S. and Iranian forces near the Strait, Trump confirmed that the ceasefire remained intact.
Additionally, the International Monetary Fund's Executive Board is set to consider the approval of a $1.2 billion tranche under the Extended Fund Facility and Rapid Financing Instrument programs, which could potentially elevate Pakistan’s foreign exchange reserves to $17 billion by the end of June 2026, according to the State Bank of Pakistan Governor. On the economic front, Pakistan's trade deficit rose by 4% year-on-year to $4.1 billion in April 2026, contributing to a 20% year-on-year increase in the trade deficit for the first ten months of fiscal year 2026, reaching $32.0 billion. Cement dispatches saw an 11% year-on-year rise to 3.9 million tons in April 2026, driven by a 20% year-on-year increase in local demand. Moreover, the Large Scale Manufacturing index increased by 11.1% year-on-year in March 2026, leading to a 6.5% year-on-year growth over the nine-month period of fiscal year 2026. As of April 30, the State Bank of Pakistan's foreign exchange reserves increased by $23 million week-on-week to $15 .85 billion.
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