The Pakistan Stock Exchange (PSX) shattered records on Tuesday, with its benchmark KSE-100 Index surging past the historic 150,000-point mark for the first time ever. Investor sentiment was fueled by a potent mix of positive economic indicators, including recent credit rating upgrades from global agencies and the government’s newly unveiled plan to tackle the massive gas circular debt. The index closed at 149,770.74 points, registering a significant gain of 1,574.32 points, or 1.06%, after hitting an intraday high of over 150,323 points.
The rally was underpinned by a wave of optimism from international financial institutions. In a major boost, credit rating agency Fitch projected Pakistan’s real GDP growth to reach 3.5% by 2027, citing improvements in the country’s fiscal performance and ongoing reforms. This reinforced Fitch’s own decision in April to upgrade Pakistan’s sovereign credit rating, a move that was preceded by a similar upgrade from Moody’s, signaling growing international confidence in the country’s economic stability.
A key driver behind the market’s exuberance was the government’s announcement of a comprehensive five-year strategy to address the Rs. 2,600 billion gas circular debt. The plan proposes three primary measures: imposing a Rs. 5 per litre petroleum levy to raise Rs. 500 billion, generating another Rs. 500 billion from dividends of state-owned companies, and diverting LNG cargoes for international sales to earn a further Rs. 500 billion annually. A senior official stated this strategy is expected to resolve Rs. 1,500 billion of the debt, with the remainder to be handled through waivers.
This record-breaking performance extends a strong bullish trend, coming a day after the index had already gained over 1,700 points. While the market celebrates these milestones, some analysts caution that the rally is being driven by strong liquidity from mutual funds taking a medium-term view, noting that “valuations are not cheap anymore.” Nonetheless, the confluence of structural reforms and improved international creditworthiness has created a powerful momentum, propelling the PSX into uncharted territory.
