Pakistan Stock Market Surges 12% Amidst Easing India Tensions

Karachi, May 18 (PTI) The Pakistan Stock Exchange (PSX) surged nearly 12 per cent in the past week after India and Pakistan reached an understanding to halt all military actions.

The week ending May 17 saw the benchmark KSE-100 index gaining 12,474 points to settle at 119,6492025, up 11.64 per cent from the closing level in the preceding week.

In the preceding week, PSX had lost nearly 6.5 per cent as uncertainty gripped the market due to the conflict with India.

Tensions between India and Pakistan soared after the Indian armed forces hit terror launchpads in Pakistan and Pakistan-occupied Kashmir (PoK) on May 7 in response to the Pahalgam terror attack.

On May 10, the two neighbours reached an understanding to stop all firings and military actions on land, air and sea, with effect from 5 pm that day.



Fatima Bucha of AKD Securities said that the easing of geopolitical tensions had a stabilising effect on investor sentiment.

She said that the historic rally was also boosted by the International Monetary Fund's (IMF) approval of the first review of Pakistan's loan programme and subsequent disbursement of a USD 1 billion tranche.

Additionally, the IMF's approval of a further USD 1.4 billion under the Resilience and Sustainability Facility reinforced optimism in the market, leading to a record single-day gain of 10,123 points at the start of the trading week, she said.

Pakistan's macroeconomic indicators have also shown improvement with workers' remittances for April reaching USD 3.2 billion, adding to the current account surplus of USD 12 million.

Foreign direct investment also showed significant improvement, with inflows of USD 141 million recorded in April compared to just USD 26 million in March.