KSE-100 adds 2,092 points in two sessions after SBP rate hike, closes at 164,467

The Pakistan Stock Exchange's benchmark KSE-100 index closed at 164,467.20 on Tuesday, 27 October 2026, up 1,428.73 points or 0.88%. Together with Monday's gain, the index rose 2,092 points in two sessions, even though the State Bank of Pakistan (SBP) raised its policy rate to 12% at the start of the week.

That is a gain of about 1.3% from the previous close of 162,374.88. Investors had sold shares before the decision. Once the rate was known, buying returned.

Two days, two different moods

The rate hike was announced on Monday, 26 October. Trading that day swung sharply.

• The index first slipped to an intraday low of 161,250.07 as investors waited for the SBP.
• The 50 basis point increase, to 12% from 11.5%, was in line with market expectations, The Express Tribune reported.
• Buying in heavyweight stocks came back in the second half. The index touched 163,477.09 and closed at 163,038.47, up 663.59 points.

Tuesday was steadier. The index opened strongly, climbed more than 1,100 points early and reached a high of 164,787.67 before it settled at 164,467.20.

KSE-100 at a glance

Which stocks did the lifting

On Monday, four names did most of the work. UBL, Engro Holdings, Lucky Cement and OGDC together added 719 points to the index. On the other side, Meezan Bank, Engro Fertilisers, Fauji Fertiliser, Pakistan Services and HBL took away 367 points.

On Tuesday, the buying spread wider. Business Recorder reported interest in oil marketing companies, commercial banks, refineries, cement, and technology and communication stocks. TechJuice also listed automobiles, fertiliser, pharmaceuticals and insurance among the sectors that gained.

Why the market rose after a rate hike

A higher interest rate usually makes borrowing dearer for companies, so a rise in share prices can look odd. Three things helped this week.

1. The uncertainty ended. The size of the hike matched what most investors had expected, so there was no fresh shock.
2. Oil eased a little. In early trade on Tuesday, Brent crude fell 0.86% to $114.81 a barrel and US crude (WTI) was at about $100.88, on hopes of diplomacy in the Middle East. Pakistan imports most of its fuel, so even a small dip matters for inflation and the rupee.
3. Regional markets were upbeat. Business Recorder reported that South Korea's KOSPI rose more than 4% in early trading and Japan's Nikkei gained 1.9%, which lifted risk appetite across Asia.

Oil is still expensive, though. The SBP named persistent global energy costs as a key reason for its hike, and Brent near $115 keeps inflation worries alive.

What to watch next

• The US Federal Reserve ends its two-day meeting on Wednesday, 28 October. The decision is due at 2pm New York time, which is 11pm in Pakistan. Markets widely expect the Fed to keep its rate at 3.75% to 4%, Kiplinger reported, so traders will focus on what Chair Kevin Warsh says about December.
• Oil prices, since every move in Brent feeds into Pakistan's daily fuel prices and inflation.
• The SBP's next meeting on 14 December 2026.

What this means for ordinary savers

A two-day rally does not tell you where the market will go next week. If you are new to shares, learn how the market works before you put money in, invest only what you will not need soon, and spread your money across more than one sector. Treat daily index moves as news, not as a signal.

This article is for information only and is not investment advice.