Inflation has probably been a feature of human history since cash was adopted as a method of clearing. Inflation presupposes the existence of money that has evolved as a random social institution through the variety of inventions and innovations. A stock exchange is a channel where buyers and sellers trade bonds and securities of registered companies and other property proceedings with payment of income plus dividends. The stock exchange plays a vital role in the development and growth of the country and in improving the inflow of global capital. Costs of securities, shares traded on a stock exchange, also called stock exchange; takes on an important role in development, encouraging capital disposition, financial success and maintaining monetary development. Say no to plagiarism. Get a tailor-made essay on "Why Violent Video Games Shouldn't Be Banned"? Get Original EssaySo, in the means of relationship (buying and selling), the market activities remain improved such that the decrease in business commissions from investors, decreases interest payments and makes for an excellent device in management. It carries out numerous responsibilities to support financial development, create prosperity and provide an excellent environment to improve Pakistan's economy. As indicated by various methodological statutes, stock trading has two types of financial investors. One approach states that investors use their floating approaches to beat trading costs and there the market is lacking. The second methods state that all financial investors have comparative data and cannot bear the stock costs and furthermore the supply depends on macroeconomic factors. A small number of outstanding theories are expected to know the connection between stock costs and inflation, and some of them are confirmed by empirical evidence. Fama (1981) is one such study that projected a negative affiliation between these two variables. Fama (1981) elaborated the negative connection between inflation and also stock profits and clarified on the basis of a positive relationship between profits on stocks and also the determinants of value estimates, for example, a normal real profit rate for the capital, uses of capital and earnings of an organization. On the other hand, if shares or securities are considered as investment goods, the connection between the two variables is ensured in view of the impact of inflation of the costs of investment goods. As we are almost aware, due to alternative capital goods, for example, horticultural goods or manufactured goods, the costs of capital goods increase with the increase in inflation. Feldstein (1980) analyzed this phenomenon and argued that inflation is expected to increase, the relationship between stock value and real profit decays because the company's pay needs to increase and also an expansion of pay is needed taxable. .Macroeconomic variables such as (interest rate, inflation rate, exchange rate, growth rate) have an effect on the performance of the stock market. The costs of publicly traded securities change daily based on supply and demand. Few factors behind the increase or decrease in supply and demand of a stock could include internal and external factors and market behavior (kurihara 2006). Inflation is the only problem among all external factors and experts consider it a hedge against stock returns. The efficiency of the stock market is affected for the cause because such macroeconomic variables are fluctuating in nature but they are the most important reason for the instability of the stock market at.