Pakistan Stock Exchange (PSX) extended its bullish run at the start of 2026, with the benchmark KSE-100 Index settling at a new record high on Wednesday, driven by sustained buying from local institutional investors.

During trading, the KSE-100 Index witnessed a sharp dip soon after the opening bell, dropping to an intra-day low of 184,896.70, but sentiment quickly improved, triggering a broad-based recovery that lifted the index steadily through the late morning and early afternoon.

The benchmark touched an intraday high of 187,015 before easing slightly, yet it held most of its gains. At close, the benchmark index settled at 186,518.71, a gain of 1,456.61 points or 0.79%.

The buying rally is fuelled by the anticipation of a policy rate cut in the upcoming Monetary Policy Committee (MPC) meeting, scheduled to be held later this month, say analysts.

 “Optimism has carried over decisively into 2026, with the PSX gaining a robust 12,464 points (+7.2%) in the first five trading sessions of the year,” said Topline Securities in its post-market commentary.

The brokerage house said the rally is driven largely by aggressive buying from local funds.

 “The shift in asset allocation—from fixed-income instruments to equities amid declining returns on traditional avenues—has continued to fuel liquidity and support elevated valuations.

HUBC, PPL, ENGROH, MCB, and MEBL emerged as key drivers, collectively contributing around 766 points to the index’s advance,” Topline added.

On Tuesday, United Bank Limited (UBL) emerged as the largest listed company in Pakistan, with its market capitalisation reaching Rs1.28 trillion (USD 4.6 billion), overtaking Oil & Gas Development Company (OGDC).

The PSX closed Tuesday’s trading session on a strong footing as sustained institutional buying pushed the benchmark index to a fresh all-time high, amid robust volumes. The benchmark KSE-100 Index surged by 2,653 points, or 1.45%, to close at a record 185,062 points.