KARACHI: Pakistan’s equity market extended its strong upward trajectory during the outgoing week, with the benchmark KSE-100 Index closing at a fresh all-time high, as easing inflationary pressures, strong sectoral performance, and heightened investor participation reinforced bullish sentiment.
The KSE-100 Index surged by 6,634 points, registering a week-on-week increase of 3.8 percent, to settle at 179,035 points, compared to 172,401 points in the preceding week.
The rally was driven by a favourable new-year effect, coupled with a softer-than-anticipated December 2025 headline inflation print of 5.6 percent, which strengthened expectations of further monetary easing going forward.
Market activity also picked up noticeably during the week. Average daily traded volume rose by 9.7 percent week-on-week to 1.26 billion shares, compared with 1.14 billion shares in the prior week, reflecting improved market participation across both retail and institutional segments.
Reflecting broad-based gains across large-cap stocks, BRIndex100 closed at 19,169.73, rising 877.06 points from its weekly opening level of 18,292.67, with total turnover amounting to 3.95 billion shares.
Meanwhile, BRIndex30 advanced to close at 61,060.05, up 1,535.60 points from its opening level of 59,524.45, while total turnover on the index stood at 2.64 billion shares, indicating strong liquidity concentration in fundamentally strong blue-chip stocks.
A key catalyst for the rally was renewed strength in the energy sector following Oil and Gas Development Company Limited’s announcement of a second hydrocarbon discovery at the Baragzai X-01 well in the Nashpa Block, Khyber Pakhtunkhwa.
The newly tested Datta (Jurassic) formation flowed at 4.1 thousand barrels per day of oil and 10.5 million cubic feet per day of gas over an interval exceeding 187 meters. This adds to the earlier Kingriali (Triassic) formation discovery announced on December 10, 2025. Cumulatively, the two formations carry a combined production potential of 6.4 thousand barrels per day of oil and 16.0 million cubic feet per day of gas, materially improving the earnings outlook for OGDCL and Pakistan Petroleum Limited.
In addition to the exploration and production space, oil marketing companies also contributed to positive sentiment, as industry fuel off-takes increased by 6 percent year-on-year during December 2025, despite a 5 percent month-on-month decline due to post-harvest base normalization and relatively weaker diesel demand.
On the macroeconomic front, Pakistan’s trade deficit widened by 24 percent year-on-year to USD3.7 billion in December 2025, reflecting higher import payments. Meanwhile, economic activity remained resilient, with real GDP growth recorded at 3.7 percent year-on-year during the first quarter of FY26.
External sector indicators remained broadly stable. State Bank of Pakistan-held foreign exchange reserves edged up by USD13 million on a weekly basis to USD15.9 billion as of December 26. The Pakistani rupee showed marginal appreciation, gaining 0.02 percent week-on-week to close at Rs280.11 per US dollar in the inter-bank market.
Other notable developments during the week included reports that the State Bank of Pakistan purchased USD6.9 billion from the currency market over the past 12 months, while the Federal Board of Revenue collected Rs6.2 trillion during the first half of FY26, falling short of its target by Rs338 billion.
Separately, Pakistan indicated plans to settle around USD1 billion in liabilities through potential UAE investment in the Fauji Group, while discussions were reported regarding US interest in locomotive sales and mineral exploration partnerships.
Authorities also confirmed plans to launch Pakistan’s first Panda bond in the Chinese market.
Sector-wise, performance remained largely positive. The Transport sector led gains with a weekly increase of 19.3 percent, followed by Property at 17.4 percent, Vanaspati and Allied Industries at 8.0 percent, Oil and Gas Exploration Companies at 6.6 percent, and Pharmaceuticals at 6.5 percent.
On the downside, Jute declined by 2.6 percent, Woollen by 2.5 percent, Cement by 2.0 percent, Real Estate Investment Trusts by 1.2 percent, and Textile Composite by 1.2 percent.
Flow data showed strong institutional participation. Mutual funds emerged as the largest net buyers during the week, with net inflows of USD24.5 million, followed by companies with net buying of USD9.4 million.
In contrast, foreign investors were net sellers to the tune of USD18.8 million, while banks offloaded equities worth USD10.7 million.
Among individual stocks, JVDC topped the weekly gainers with a rise of 24.2 percent, followed by SSOM (up 12.6 percent), UBL (up 12.5 percent), FFL (up 11.5 percent), and EFERT (up 10.9 percent). On the losing side, DGKC declined by 9.6 percent, CHCC by 7.6 percent, KTML by 7.4 percent, KOHC by 6.4 percent, and MLCF by 4.2 percent.
Market’s total capitalization stood at Rs19.32 trillion, equivalent to USD68.97 billion, compared with Rs19.47 trillion in the previous week.
Looking ahead, analysts expect the positive momentum to continue, supported by improving macroeconomic stability, a stronger external account position, and sustained reform efforts amid political continuity.
Copyright Business Recorder, 2026