It was a historic day at the Pakistan Exchange (PSX) on Wednesday, as investors rejoiced after the US and Iran agreed to a two-week ceasefire amid Pakistan’s mediation efforts.
The ceasefire also triggered a global relief rally, with oil prices plunging sharply and equities surging across the US, Europe, and Asia.
Bullish momentum was observed right from the opening bell, as the benchmark KSE-100 Index gained over 8%, triggering a market halt at 9:37am.
“All TRE Certificate Holders are hereby informed that due to a 5% increase in the KSE-30 index from the previous trading day’s close of the same, a market halt has been triggered as per PSX Regulations, and all equity-based markets have been suspended accordingly,” read the notice.
The market activity resumed at 10:42am.
As the session progressed, the index maintained a sustained upward trajectory driven by aggressive buying, hitting an intraday high of 165,924.13.
The KSE-100 Index closed at 165,811, recording its highest-ever single-day gain of 14,138 points or 9.32%.
“Today was a short-seller’s nightmare and a buyer’s paradise,” said Behtari Capital on Wednesday.
“While the ceasefire is provisional, the combination of debt repayment success and lower oil prices has created a strong floor for the index,” it added.
Waqas Ghani, Head of Research at JS Global, told media that Pakistan’s diplomatic efforts to ease United States–Iran tensions triggered a sharp sentiment reversal at the PSX, with a peace-driven rally highlighting both the rapid unwinding of risk premiums and the market’s underlying upside potential.
“Going forward, sustained de-escalation and/or a formal settlement could trigger a further correction in commodities and a broad based recovery across financial markets,” said Arif Habib Limited (AHL) in a note.
The focus now turns to monetary policy, with the SBP closely monitoring developments on the geopolitical front and their implications for the economy, said the brokerage house.
“While secondary market yields have already priced in a 100-150bps hike, sustained easing of geopolitical tensions and the absence of major external shocks could provide room for the SBP to adopt a more accommodative stance.
“That said, risks remain: any breach of the two-week ceasefire or setbacks in achieving a broader resolution could swiftly trigger renewed volatility,” it added.
US President Donald Trump, following talks with Prime Minister Shehbaz Sharif and Field Marshal Asim Munir, said on Tuesday that he had agreed to a two-week ceasefire with Iran, less than two hours before his deadline for Tehran to reopen the Strait of Hormuz or face widespread attacks on its civilian infrastructure.
“This will be a double-sided CEASEFIRE!” Trump wrote on his Truth Social platform. “The reason for doing so is that we have already met and exceeded all Military objectives, and are very far along with a definitive Agreement concerning Longterm PEACE with Iran, and PEACE in the Middle East.”
Prime Minister Shehbaz Sharif welcomed the ceasefire and invited delegations from the US and Iran to Islamabad on Friday, 10th April 2026, to further negotiate for a conclusive agreement to settle all disputes.
On Tuesday, PSX witnessed another volatile trading session with the benchmark KSE-100 Index moving within a wide range before closing in positive territory, as late-session buying driven by optimism over ceasefire developments supported investor sentiment. The KSE-100 settled at 151,673.46 points, posting a gain of 465.64 points or 0.31%.
Internationally, oil prices dived, stocks surged and the dollar was knocked back on Wednesday as a two-week Middle East ceasefire sparked a relief rally, fuelled by hopes that oil and gas flows through the Strait of Hormuz could resume.
The news capped weeks of market volatility and geopolitical upheaval after US and Israeli strikes on Iran at the end of February pushed tensions to the brink, with Tehran effectively choking off the strategic waterway that typically carries about 20% of the world’s oil and gas.
Market reaction was swift and dramatic, with US crude futures down around 15% to $96.31 a barrel, while Brent futures also slid 13% to $95.36 per barrel.
S&P 500 futures jumped more than 2%, while European futures leapt more than 5%.
In Asia, Japan’s Nikkei surged about 5% while South Korea’s KOSPI rose 6%, triggering a brief halt in trading.
That left the MSCI’s broadest index of Asia-Pacific shares outside Japan up 4%. Beyond the immediate relief, investors remain keen to see whether the ceasefire leads to a broader resolution before placing major bets.
Meanwhile, the Pakistani rupee registered marginal gain against the US dollar in the inter-bank market on Wednesday. At close, the local currency settled at 279.05, a gain of Re0.01, against the greenback.
Volume on the all-share index jumped to 1,245.18 million from 357.27 million recorded in the previous close.
The value of shares rose to Rs54.40 billion from Rs20.44 billion in the previous session.
F. Nat.Equities was the volume leader with 212.31 million shares, followed by K-Electric Ltd with 127.32 million shares, and WorldCall Telecom with 97.31 million shares.
Shares of 491 companies were traded on Wednesday, of which 448 registered an increase, 16 recorded a fall, and 27 remained unchanged.
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