KARACHI, May 29 (Alliance News): The Pakistan Stock Exchange (PSX) surged on Thursday as investor sentiment was buoyed by expectations of fiscal discipline and anticipated tax relief for the salaried class in the upcoming federal budget.
The benchmark KSE-100 Index closed at 118,971.40 points, gaining 638.50 points, or 0.54%, from the previous close of 118,332.90.
During intraday trading, the index reached a high of 119,639.47 — up 1,306.57 points or 1.1% — before settling lower but still in positive territory. The session’s low of 118,481.97 also remained above the previous close, reflecting sustained investor interest.
“There is overall optimism on IMF’s dollar being transferred, the budget aligning with IMF targets, and the continuation of the growth story,” noted AAH Soomro, an independent investment and economic analyst.
Ahfaz Mustafa, CEO of Ismail Iqbal Securities, added that while the market is reacting positively, it remains within a narrow range. “Markets are trading within a tight 3% to 4% range as people respond to speculation about the federal budget’s content.”
The optimism comes despite unresolved discussions with the International Monetary Fund (IMF).
The government, which had earlier delayed the budget presentation from June 2 to June 10 to meet fiscal targets, resumed talks with the IMF on Thursday. However, officials confirmed no breakthrough had been achieved yet.
The Economic Survey — which outlines the country’s economic performance and sets the stage for the budget — is still expected on June 9, pending final confirmation.
Finance Minister Muhammad Aurangzeb further lifted sentiment earlier this week by confirming that the FY26 budget would include tax relief for salaried individuals.
Speaking in Islamabad, he emphasized that the upcoming budget would be more than just a fiscal document — it would provide strategic economic direction. “We are committed to easing the burden on salaried taxpayers, whose income is taxed at source,” he said.
The budget is expected to focus on fiscal consolidation, expanding the tax base, and reducing untargeted subsidies in line with IMF requirements to ensure long-term debt sustainability.
Thursday’s rally followed a market holiday observed midweek for Youm-e-Takbeer. In the previous trading session on Tuesday, the KSE-100 index had posted a modest gain of 111.79 points, or 0.09%, closing at 118,332.91. That session saw a high of 118,807.92 and a low of 118,143.68.
As budget day approaches, investor sentiment appears cautiously optimistic, driven by hopes of economic reforms and international financial backing to stabilize and grow Pakistan’s economy.
