KSE‑100 End‑June Rally Gains 0.4% on Middle East De‑Escalation

The Pakistan Stock Exchange extended its gains during the final week of June, with the benchmark KSE‑100 Index advancing 649 points, or 0.36% week‑on‑week, to close at 179,571 points. Easing geopolitical tensions in the Middle East helped sustain investor confidence despite rollover‑week pressures.

The market remained resilient as investors welcomed a newly signed peace memorandum of understanding and improving prospects for a US‑Iran deal. Those developments pushed international oil prices lower and raised expectations of easing inflation.

Exploration and production companies provided the biggest boost, adding 365 points to the index. Cement stocks contributed 352 points, followed by leather and tanneries (126 points), textile composite firms (71 points) and the power sector (64 points).

Banking stocks were the largest drag, shaving 226 points off the benchmark. Technology stocks reduced the index by 85 points, while investment banks, fertiliser companies and refinery stocks also detracted.

At the company level, Oil and Gas Development Company (OGDC) topped the gainers, adding 196 points. United Bank Limited contributed 145 points, followed by Pakistan Petroleum Limited (141 points), Service Industries (126 points) and Maple Leaf Cement Factory (109 points).

Among the laggards, Bank AL Habib erased 158 points, Bank Alfalah reduced it by 115 points. Habib Bank Limited, Fauji Fertilizer Company and Pakistan State Oil also weighed on overall performance.

AKD Securities said the market remained supported by optimism surrounding progress on a potential US‑Iran agreement, declining global oil prices and expectations of favourable corporate earnings for June 2026. Easing inflationary pressures and improving macroeconomic conditions continue to underpin investor sentiment, while the market remains attractively valued at a forward price‑to‑earnings ratio of 7.1 times.

Despite the weekly gain, average daily trading volumes fell 30% week‑on‑week to 808 million shares, and the average daily traded value dropped 41% to $134 million.

Investor interest strengthened on the final trading day, with the benchmark index gaining 1,878 points on Wednesday as broad‑based buying emerged ahead of extended holidays. Ali Najib, Deputy Head of Trading at Arif Habib Limited, attributed the rally to optimism over improving geopolitical developments.

Looking ahead, analysts expect the market to retain its positive momentum as investors continue to monitor US‑Iran negotiations and international oil prices. Lower inflation, prospects of monetary easing and attractive valuations are expected to support sentiment. The KSE‑100 trades at a price‑to‑earnings ratio of 8.3 times and offers a dividend yield of 6.1%, while preferred picks include OGDC, PPL, Fauji Fertilizer Company, Lucky Cement, National Bank of Pakistan, Hub Power Company, Pakistan State Oil and Attock Refinery Limited.

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