KARACHI: The Pakistan Stock Exchange (PSX) witnessed a rollercoaster week marked by political uncertainty, border tensions, and renewed investor optimism following Pakistan’s staff-level agreement with the International Monetary Fund (IMF).
The KSE-100 Index opened at 163,098.19 points and, after a series of volatile sessions, closed at 163,806.22 points, trimming most of its losses, reflecting a weekly gain of 708.03 points which was 0.4 percent.
During the week, the BRIndex100 closed at 17,152.20 points. The index recorded a total turnover of 8.11 billion shares, translating into an average daily volume of about 1.62 billion shares, showing strong investor participation across the board. Similarly, the BRIndex30 began the week at 54,150.06 points, and settled at 54,912.22 points by the close. The total turnover amounted to 6.52 billion shares, averaging around 1.30 billion shares per session.
Analysts described the week as a test of investor nerves, with early sessions dominated by profit-taking and uncertainty stemming from cross-border hostilities with Afghanistan and sporadic nationwide protests. Market sentiment turned positive midweek as Islamabad secured an IMF staff-level agreement for the second review of the USD7 billion Extended Fund Facility (EFF) and the first review of the US$1.3 billion Resilience and Sustainability Facility (RSF).
Under the deal, Pakistan will unlock USD1.2 billion, comprising USD1 billion under the EFF and US$200 million under the RSF, pending Executive Board approval. The IMF also projected Pakistan’s GDP growth at 3.6 percent and inflation at 6 percent for FY26, while estimating a 0.4 percent rise in the net debt-to-GDP ratio.
JS Global Research stated that the IMF deal helped restore confidence and attract fresh liquidity to the market serving as a stabilizing factor after several volatile sessions.
Market activity strengthened notably. Average daily turnover on the ready board surged 34.5 percent week-on-week to 1.83 billion shares, while the average traded value rose to Rs55.57 billion (US$198 million).
The market capitalization edged up 0.3 percent to Rs18.97 trillion, equivalent to USD67.48 billion, supported by renewed investor participation and improved liquidity.
On the sectoral front, banks, power, and technology stocks led the charge. According to AHL Research, banks contributed 904 points to the KSE-100’s overall movement, followed by power (+204 points), technology (+108 points), miscellaneous (+84 points), and cement (+69 points). Declines were mainly driven by fertilizers (-296 points), exploration and production (-222 points), investment banks (-99 points), oil marketing companies (-58 points), and fast-moving consumer goods (-30 points).
Among individual contributors, United Bank Limited (UBL) added the highest 321 points, followed by Hub Power Company (HUBC) with 208 points, Bank of Punjab (BOP) with 174 points, Lucky Cement (LUCK) with 170 points, and Meezan Bank (MEBL) with 132 points. Major laggards included Engro Fertilizers (EFERT), Engro Corporation (ENGROH), Oil and Gas Development Company (OGDC), Pakistan Petroleum Limited (PPL), and Fauji Fertilizer Company (FFC), which collectively erased over 700 points from the index.
Top performing stocks were Pakistan Services Limited (PSEL), which soared 14.9 percent to Rs1,022.35, Bank of Punjab (BOP) up 11.7 percent to Rs35.83, and S.S.Oil Mills Limited (SSOM) gaining 7.4 percent to Rs382.13. Pakistan Stock Exchange Limited (PSX) and Lotte Chemical Pakistan (LOTCHEM) also climbed 6.5 percent each. The worst performers included Gadoon Textile Mills Limited (GADT), down 7.1 percent, Pakgen Power (PKGP), off 6.8 percent, and Pak Aluminium Beverage Cans (PABC), lower by 6.7 percent.
The broader economy showed mixed signals. The Pakistan Bureau of Statistics (PBS) reported a trade deficit of US$3.4 billion in September, taking the first-quarter FY26 deficit to US$9.4 billion, up 33.8 percent year-on-year. Meanwhile, the Pakistani rupee remained largely stable at Rs281.10 per US dollar.
The State Bank of Pakistan’s reserves rose slightly to USD14.44 billion, up USD20.7 million week-on-week, while large-scale manufacturing (LSM) recorded a 0.5 percent year-on-year increase, hinting at gradual industrial recovery.
On the fiscal side, the government raised Rs506.7 billion in Pakistan Investment Bonds and Rs775.9 billion through Treasury Bills, surpassing combined auction targets. Yields on PIBs rose between 13 and 21 basis points, while those on T-bills remained largely steady.
In the energy sector, refinery output excluding furnace oil grew 21.6 percent year-on-year in September, led by a 32 percent surge in high-speed diesel upliftment, indicating stronger domestic demand and improved enforcement against illicit fuel inflows. Oil production also increased by 1.3 percent week-on-week to 65,301 barrels per day, driven by higher output from the Sharf, Pasakhi, and Makori East fields.
Foreign portfolio investors continued to trim exposure, with total net outflows of USD13 million during the week. The heaviest selling came from foreign corporates, offloading US$11.9 million, while overseas Pakistanis sold US$1 million. Sector-wise, foreign investors reduced positions in commercial banks (USD3.6 million), fertilizers (US$1.8 million), and E&Ps (USD3.3 million).
Local investors, however, absorbed much of the selling, recording net inflows of US$13 million. Institutional buying was led by banks and DFIs, which added US$71 million net, while individuals and companies also contributed modestly. Mutual funds and insurance firms, in contrast, remained net sellers.
Analysts expect momentum to remain linked to developments on the IMF front and ongoing corporate results. “Any positive development regarding the IMF Executive Board’s approval is likely to further strengthen investor sentiment,” AHL projected. JS Global concurred, noting that the late-week rebound “underscored market resilience and investor confidence in macroeconomic stability.”
With reserves improving, inflation expectations softening, and turnover expanding, the PSX appears poised for consolidation. Market watchers believe that if political calm persists and IMF inflows arrive on schedule, the KSE-100 Index may soon test the 165,000-point resistance, setting the stage for a more sustained rally into the next quarter.
Copyright Business Recorder, 2025