The Pakistan Stock Exchange (PSX) extended its bullish momentum on Friday, with the benchmark KSE-100 index surging by 1,932 points, or 1.17 percent, to reach 167,449 in early trading. The rally reflected improved investor sentiment driven by easing geopolitical tensions following a ceasefire in the Middle East.

Market analysts attributed the upward trend to renewed confidence across regional equities after several days of volatility. The positive sentiment was not limited to Pakistan, as Asian markets also posted gains. Japan, South Korea, and Indonesia saw their benchmark indices rise by around 2 percent, while markets in India and Vietnam climbed approximately 1 percent. Shanghai and Hong Kong also recorded modest gains.

Experts noted that easing geopolitical risks played a key role in boosting investor appetite for riskier assets. The PSX had already shown signs of recovery earlier in the week, and Friday’s session extended that momentum.

In a separate development, the Asian Development Bank (ADB) reported that Pakistan’s economy is showing gradual improvement, though it warned of persistent risks. The ADB projected Pakistan’s GDP growth at 3.5 percent for the current fiscal year, with an expected increase to 4.5 percent in the next year.

However, the report cautioned that renewed tensions in the Middle East could trigger inflationary pressures and impact economic stability. Inflation is forecast to average 6.4 percent in fiscal year 2026 and slightly rise to 6.5 percent in fiscal year 2027.