Karachi: The KSE-100 Index reached new heights this week, climbing 2,351 points to close at 134,299. This marks a 2% increase week-over-week, even as the average daily trading volume saw a slight decline of 2%.

The market's rally was bolstered by a record surge in remittances, which increased by 27% year-over-year to an unprecedented $38.3 billion in the fiscal year 2025. Investor confidence was also strengthened by reports of a potential agreement between Pakistan and the United States concerning reciprocal tariffs.

Additionally, a Dubai-based bank has organized a $1 billion financing facility for Pakistan, further boosting investor sentiment. The Pakistani government achieved a fiscal milestone by retiring Rs1.5 trillion in public debt earlier than expected, reducing the debt-to-GDP ratio to 69% from 75% in fiscal year 2023.

Efforts to issue Pakistan's first Panda bond are advancing, with government officials holding meetings in China to finalize preparations. On the external financial front, the State Bank of Pakistan's reserves increased by $1.8 billion week-over-week, reaching $14.5 billion and pushing total reserves past the $20 billion mark for the first time in three years.

The latest T-bill auction saw the State Bank of Pakistan raising Rs1.4 trillion against a target of Rs1.35 trillion, with yields remaining largely stable across various maturities. In sector-specific news, the auto industry showed a strong recovery in fiscal year 2025, with volumes up 43% year-over-year to 148,019 units, while month-over-month figures rose by 47% to 21,769 units.