PSX delivers region's best 3-year, 5-year returns

July 02, 2026 (MLN): Pakistan's benchmark KSE-100 Index has posted the strongest three-year and five-year US dollar returns among 14 major regional and emerging-market indices, according to the Pakistan Stock Exchange (PSX).

This indicates the depth of the rally that has powered the local equities since 2023.

Data compiled as of June 30, 2026, show that the KSE-100 delivered a compound annual growth rate (CAGR) of 67.48% in US dollar terms over three years, the highest of any index in the comparison set, and 17.17% over five years, also the highest.

On a one-year basis, the index returned 46.40% in dollar terms, placing it third behind South Korea's KOSPI (141.22%) and Thailand's SET Index (49.26%).

The KSE-100's one-year return also outpaced both the MSCI Emerging Markets Index (44.18%) and the MSCI Frontier Markets Index (35.39%), as well as regional peers including Singapore's FTSE Straits Times (33.95%), Japan's TOPIX (26.93%) and China's Shanghai SE Composite (25.50%).

Pakistan's outperformance is more pronounced over the longer horizons typically used by institutional allocators. The three-year CAGR of 67.48% is more than double the next-best index in the sample, Sri Lanka's CSE All Share, which returned 30.81% over the same period.

On a five-year basis, the KSE-100's 17.17% CAGR compares with 16.80% for Singapore's FTSE Straits Times and 16.35% for the UAE's DFM General Index, the next-closest peers.

At the other end of the table, Indonesia's Jakarta Composite Index posted the weakest returns across all three horizons, down 26.04% over one year, 11.42% over three years and 5.48% over five years in dollar terms.

India's Nifty 50 also underperformed on a one-year basis, down 14.38%, though it recovered to positive territory over three years (3.95%) and five years (5.02%).

Saudi Arabia's Tadawul FF Index and Hong Kong's Hang Seng Index posted negative returns on at least two of the three horizons measured.

The comparison, published by the PSX, ranks indices by one-year dollar returns.

It captures a period that includes Pakistan's disinflation cycle, a reduction in the State Bank of Pakistan's policy rate from its 2023 peak, and improved external account metrics following the completion of successive IMF review cycles, factors that have supported foreign and local investor appetite for PSX-listed equities.

The rally is generally attributed to a combination of macro stabilisation, undemanding valuations relative to regional peers at the start of the run, and improved corporate earnings in cyclical sectors such as banking, cement, and energy.

The KSE-100's dollar-return outperformance also reflects currency stability over the review period, in contrast to markets such as Indonesia and India, where local-currency gains were partly offset by currency depreciation against the dollar.

Copyright Mettis Link News