By Moaaz Manzoor

The Pakistan Stock Exchange (PSX) extended its upward momentum during the week, as continued optimism following the US–Iran ceasefire and expectations of further diplomatic progress supported strong investor sentiment, reports WealthPakistan.

The benchmark KSE-100 Index closed at 173,939 points, registering a gain of 4.0% week-on-week, or 6,748 points. The market remained active, touching an intra-week high of 174,404 points and a low of 160,159 points, reflecting a sharp recovery in sentiment.

According to Arif Habib Limited, banks led the index gains, contributing 2,725 points, followed by exploration and production (964 points), power (613 points), cement (509 points), and auto assemblers (448 points). On the downside, the refinery and tobacco sectors slightly weighed on the index, with negative contributions of 2.48 points and 2.39 points, respectively.

On a scrip-wise basis, United Bank Limited emerged as the top contributor with 1,404 points, followed by National Bank of Pakistan (556 points), Oil and Gas Development Company (551 points), Hub Power Company (547 points), and Pakistan Petroleum Limited (322 points). Meanwhile, Meezan Bank Limited, Pakistan Telecommunication Company Limited, Attock Refinery, Pakistan Services Limited, and PAKT slightly dragged the index.

Trading activity remained strong during the week. Average daily volumes increased by 35.7% week-on-week to 1,037 million shares, while average traded value rose by 17.1% to $173.5 million, indicating robust investor participation.

The rally was supported by sustained positive sentiment following the earlier temporary ceasefire between the US and Iran, along with expectations of progress in ongoing negotiations. The announcement of a 10-day ceasefire in Lebanon further strengthened hopes of regional stability.

Ali Najib, Deputy Head of Trading at Arif Habib Limited, said the PSX continued its strong post-ceasefire rally, with the KSE-100 Index closing at 173,939, gaining 4,027 points, or 2.37% on a day-on-day basis.

He noted that market sentiment remained firmly positive throughout the session, with investors actively rebuilding positions amid optimism over a potential resolution in the Middle East, which has strengthened overall risk appetite.

He added that UBL, NBP, PPL, OGDC, LUCK, HBL, BOP, HUBC, ENGROH, and BAHL were among the top contributors, collectively adding 2,497 points due to strong buying interest.

According to Arif Habib Limited, the KSE-100 Index is currently trading at a price-to-earnings ratio of 8.5x, offering a dividend yield of around 6.0%. Top picks include OGDC, PPL, FFC, LUCK, NBP, HUBC, PSO, and ATRL.

Meanwhile, AKD Securities said that upcoming negotiations related to the US–Iran conflict would remain a key focus for investors, with any positive developments likely to drive further market recovery, particularly given Pakistan’s improved diplomatic positioning. Despite the recent rally, the market continues to trade at attractive valuations, with a forward price-to-earnings ratio of 7.4x.

Looking ahead, analysts believe market direction will remain closely tied to developments surrounding US–Iran talks, with ongoing diplomatic engagement expected to influence near-term momentum and investor positioning.

Credit: INP-WealthPk