ISLAMABAD: Pakistan’s main stock index surged to a new record on Thursday, closing above the 138,000 mark for the first time, driven by strong institutional inflows and a sharp rally in fertilizer and blue-chip stocks, according to analysts and market data.

The benchmark KSE-100 index closed at 138,665.49 points, gaining 2,285.53 points or 1.68 percent from the previous close of 136,379.96, a bullish move that traders said reflected investor optimism ahead of earnings season and growing expectations of a credit rating upgrade.

Fertilizer companies led the rally, with Fauji Fertilizer Company Limited (FFC) and Engro Fertilizers Limited (EFERT) together adding 563 points to the index. Other top contributors included United Bank Limited (UBL), Systems Limited (SYS), Engro Holdings (ENGROH), and Hub Power Company Limited (HUBC), which added another 763 points collectively, brokerage firm Topline Securities said in its daily report.

“This rally was driven by heavy institutional flows, with local investors stepping in to scoop up value,” Topline said. “With sentiment back in high gear, today’s bullish close sets an upbeat tone heading into the heart of earnings season.”

Investor activity remained high with 778 million shares traded, while the total value of trades stood at Rs39.95 billion ($140.2 million). Pakistan International Bulk Terminal (PIBTL) led volumes, with 82.6 million shares exchanged during the session.

Ahsan Mehanti, CEO of Arif Habib Commodities, said investor confidence was boosted by anticipated strong corporate earnings, attractive dividend expectations and government engagement with Moody’s over a potential rating upgrade.

“Government affirmation over talks with industrials on budgetary measures, and the finance minister’s presentation to Moody’s of compelling evidence for a ratings improvement played a catalytic role in today’s close,” Mehanti said.