KARACHI: The Pakistan Stock Exchange (PSX) sustained its record-setting advance during the outgoing week, with the benchmark KSE-100 Index climbing 3.8 percent, or 5,659 points, to an unprecedented close at 154,277 points. This marked the fourth highest weekly finish of the year, driven by strong local investor appetite, optimism surrounding the Prime Minister’s China visit, and supportive macroeconomic developments, even as foreign selling persisted.
Trading activity gained momentum, with average daily volumes improving by 19 percent to 1.07 billion shares compared to 899 million shares in the previous week. The ready market turnover, in value terms, expanded by almost 45 percent to Rs50.1 billion, reflecting heightened investor interest.
Market flows revealed a divergence in sentiment, with foreigners and banks collectively shedding positions worth over US$22 million, while individuals and mutual funds absorbed the selling, providing combined net buying of more than US$19 million.
In parallel with the benchmark KSE-100’s record close, the BRIndex100 also advanced strongly, finishing the week at 15,808.16 points, up 727.73 points from the previous week. The index recorded an average daily turnover of 886.56 million shares, reflecting heightened investor participation.
The BRIndex30 followed a similar trajectory, closing the week at 48,265.28 points, marking a robust gain of 4,338.22 points week-on-week. Its average daily turnover stood at 536.37 million shares, underscoring sustained activity in the most liquid stocks of the market.
The rally was broad-based across key sectors. Cement emerged as the strongest performer, adding 6 percent over the week on the back of robust local demand and double-digit growth in dispatches, contributing more than 1,100 points to the index. Refinery and Power followed closely with gains of 5.2 and 4.9 percent, respectively, supported by improved earnings prospects and higher generation. E&Ps and OMCs benefited from a seven percent year-on-year increase in petroleum sales, while fertilisers, chemicals, and engineering stocks also posted steady advances.
Technology and communications, along with commercial banks, dominated overall activity and remained the most actively traded sectors, while auto assemblers and selected consumer counters lagged behind.
On the corporate front, the week belonged to the Bank of Punjab, which soared 30.7 percent to emerge as the top gainer, followed by National Refinery with a 26.7 percent surge. HBL growth fund, National Bank of Pakistan, and Javedan Corporation also delivered double-digit returns.
In contrast, Pakgen Power Limited proved to be the worst performer of the week, shedding 14.3 percent, while Standard Chartered Bank Pakistan slipped 6.6 percent and JDW Sugar fell 5.3 percent. Other notable losers included IBFL, Unilever Pakistan Foods, and Lucky Cement Industries, all of which closed the week in the red.
On the economic front, the indicators painted a mixed picture. Inflation offered relief as the consumer price index eased to 3 percent year on year basis in August and from 4.1 percent in July this year, raising hopes for monetary easing in the months ahead. Petroleum sales provided further comfort, registering a seven percent increase year-on-year, while large-scale manufacturing expanded 2.1 percent in July.
At the same time, headwinds persisted in the external account, as the trade deficit widened by 30 percent year-on-year to USD 2.87 billion amid a six percent increase in imports and a steep 12.5 percent decline in exports. Fiscal challenges also remained evident, with the Federal Board of Revenue collecting Rs886 billion in August, missing its target by Rs64 billion and bringing cumulative revenue in the first two months of FY26 to Rs1.63 trillion.
Meanwhile, the government continued to highlight its commitment to fiscal discipline by repaying Rs1.6 trillion of public debt to the State Bank ahead of schedule. In the money market, the government mobilised Rs515 billion through a T-bill auction, surpassing its Rs400 billion target, while yields softened slightly. The central bank’s foreign exchange reserves rose modestly by USD 28 million to USD 14.3 billion, lending further support to market confidence.
Investor sentiment was bolstered by Prime Minister Shahbaz Sharif’s high-profile visit to China, where he secured memoranda of understanding worth USD 8.5 billion and reaffirmed progress into the second phase of the China-Pakistan Economic Corridor through five new economic corridors. This development, market observers said, revived expectations of continued foreign investment and infrastructure growth.
JS Global, in its weekly commentary, observed that the rally was underpinned by robust local liquidity, particularly from individuals and mutual funds, which has effectively offset persistent foreign outflows of USD 9.5 million during the week. The brokerage added that easing inflationary pressures and continuity of policy on the CPEC front would support equities going forward, although widening trade deficits and missed fiscal targets could become constraints if not addressed promptly.
AKD Securities maintained an optimistic stance, projecting that the KSE-100 is anticipated to sustain its upward trajectory, driven by strong earnings in fertilizers, sustained returns on equity in banks, and improving cash flows of E&Ps and OMCs, benefiting from falling interest rates and economic stability.
With PSX market capitalization climbing 2.7 percent to Rs18.13 trillion, equivalent to USD 64.4 billion, analysts believe equities remain on a strong footing. However, they also caution that sentiment will remain sensitive to fiscal consolidation and external trade dynamics, with sustained progress on reforms and foreign inflows required to maintain the bullish momentum.
Copyright Business Recorder, 2025
Comments
Comments are closed for this article.