The Pakistan Stock Exchange (PSX) experienced a significant upturn on Wednesday, driven by positive investor sentiment following the federal budget announcement. The benchmark KSE-100 Index jumped 1.73% (2,111.52 points), reaching an intraday high of 124,135.96, as market participants welcomed favorable tax policies and fiscal discipline aligned with IMF recommendations.
Analysts attributed the rally to the government’s decision to maintain the capital gains tax (CGT) on equities at 15% while increasing taxes on interest income, a move expected to shift investor preference towards stocks. The budget outlines Rs19.3 trillion in revenues and Rs25.8 trillion in expenditures, resulting in a federal fiscal deficit of 5% of GDP. Experts suggest that if approved without major changes, the budget could lead to a market re-rating, further boosting stock appeal in the coming fiscal year.