The Pakistan Stock Exchange (PSX) witnessed a moment of history on Tuesday as the benchmark KSE-100 index crossed the 150,000 mark for the first time ever. The market closed at 150,042 points after a sharp gain of 1,845 points, a surge that traders described as “a new era of optimism.”
For months, investors have been cautious, watching global uncertainty and local challenges. But this week, sentiment shifted. The rally appeared right after Fitch Ratings issued a positive outlook on Pakistan’s banking sector, reinforcing confidence that the country’s financial system is on firmer ground. It followed an earlier upgrade by Moody’s, which had raised Pakistan’s credit rating just weeks before. Together, these moves acted like fuel for a market eager for good news.
Why the Mood is Changing
Pakistan’s economy has gone through years of turbulence — soaring inflation, political instability, and painful reforms. But signs of recovery are now visible. Inflation, which once peaked at a staggering 38% in mid-2023, has cooled to just over 4% by July 2025. The central bank has halved its policy rate to 11%, easing borrowing costs and encouraging businesses to expand.
Fitch expects GDP growth to gradually pick up, reaching 3.5% by 2027. Investors believe the banking sector will play a central role in this turnaround, as lower rates encourage private borrowing and reduce banks’ heavy reliance on government debt.
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A Turning Point for Markets
Market insiders say the PSX crossing 150,000 is more than just a number — it reflects a shift in national mood. “For the first time in years, people are talking about growth, not crisis,” said a senior broker on the trading floor. “Investors finally see stability on the horizon.”
Pakistan’s banks, meanwhile, have shown resilience through tough times, keeping capital buffers strong and deposits steady. With international agencies signaling improved confidence, the financial sector is now seen as the backbone of recovery.
For ordinary investors, the rally has brought a sense of relief. As one small investor put it: “It feels like Pakistan is finally breathing again.”