Pakistan stock market rises to record high

The Pakistan Stock Exchange reached another all-time high on Tuesday on expectations that inflation would be in line with projections, potentially leading to a cut in the benchmark interest rate.

The benchmark KSE-100 index rose to 128,199.42 points, gaining around 2.05% or 2,572.11 points.

Inflation in June was recorded at 3.2%, with the real interest rate around 7.8%, which provides a cushion to the central bank to cut the interest rate by 50 basis points.

Another factor that boosted investor sentiment was the expectation that macroeconomic indicators for June would be healthier than May.

Yet another important factor was that a Pakistani delegation is in the U.S. to hold talks on trade, with the expectation that tariffs would be lowered.

Moreover, analysts were of the opinion that the budget for fiscal year 2025-26 was in line with the IMF's demands. Thus, the country is expected to easily clear the next review of the $7 billion loan program in September.

Moreover, the government is making efforts to reduce the electricity tariff which would benefit the industry, boosting exports and companies' earnings, according to an analyst.