On June 27, 2025, the Pakistan Stock Exchange (PSX) showcased a robust performance, with the KSE-100 Index climbing 1,581.77 points, a 1.3% gain, to reach 123,628.23 during intra-day trading. This rally, fueled by the National Assembly’s approval of the Rs17.6 trillion budget for 2025-26, reflected strong investor confidence. Consequently, the market paused for the Namaz break, with trading set to resume afterwards.
The National Assembly passed the Finance Act 2025 on June 26, with 201 coalition members voting in favour and 57 opposition members voting against. Finance Minister Muhammad Aurangzeb presented the budget, which introduces Rs463 billion in new taxes and brings the digital economy under tax regulations. However, a crucial enforcement measure that would ban transactions by ineligible individuals largely failed to take effect. President Asif Ali Zardari is expected to approve the budget, which will take effect on July 1, and is expected to foster economic optimism.
The KSE-100 fluctuated between a high of 123,628.23 and a low of 122,222.69, following Thursday’s closing value of 122,046.46. Trading volume reached 81 million shares, valued at Rs9 billion, indicating strong market engagement. For example, sectors such as cement and technology are likely to have contributed to the gains, building on the economic framework outlined in the budget.
The Rs 17.6 trillion budget allocates Rs 8.2 trillion for interest payments, making this the largest single expense. The government allocates Rs 2.55 trillion for defence spending, excluding military development and pension expenditures. Subsidies take up Rs 1.1 trillion, while pensions and development spending each claim Rs 1 trillion. Additionally, the government dedicates Rs 917 billion to civil government operations. These allocations show a focus on maintaining fiscal stability and supporting economic growth.
The budget’s approval, coupled with investor enthusiasm, positions the PSX for potential further gains. Meanwhile, the market’s 1.69% week-to-date rise, per Arif Habib Limited, suggests resilience despite recent volatility. As the fiscal year begins, analysts anticipate the KSE-100 could test the 130,000 mark, driven by budget-driven economic reforms and global stability, per Reuters.
