Karachi: The stock market experienced a tumultuous week, initially surging on Monday by 7,241 points, or 4.2%, driven by easing tensions between the United States and Iran. The possibility of a diplomatic resolution led to a decline in oil prices, which fell below $85 per barrel. However, the market faced pressure during the week as a lasting resolution remained elusive, before rebounding on Friday to close 3.0% higher for the week at 176,094 points. The rebound was attributed to Pakistan's efforts in facilitating the resolution of the Islamabad Memorandum of Understanding and favorable financial results from major companies.

According to AKD Securities Limited, the State Bank of Pakistan's decision to maintain the status quo in its first fiscal year 2027 Monetary Policy Committee meeting had minimal impact on the market, as it aligned with expectations. Market participation saw a significant increase, with the average daily traded volume rising by 48.5% to 1.3 billion shares. On the macroeconomic front, the State Bank of Pakistan's foreign exchange reserves fell by $229 million to $17.0 billion as of July 24, 2026. Additionally, Saudi Arabia extended its $5 billion deposit for another three years, reducing Pakistan's external debt repayments to $21.5 billion for fiscal year 2027. The Pakistani rupee appreciated slightly by 0.02% against the US dollar, closing the week at 277.80 PkR/US$.