The Pakistan Stock Exchange (PSX) witnessed a volatile trading week as investors remained cautious ahead of the FY26 budget announcement, now rescheduled for June 10, 2025, amid ongoing IMF negotiations.
Despite initial uncertainty, the KSE-100 index managed to post a modest weekly gain of 0.49%, closing at 119,691 points, supported by positive developments on the economic front including China's pledge to refinance $3.7 billion in commercial loans and a successful T-bill auction that raised Rs772 billion. However, foreign investors continued to offload their positions, with net outflows of $5.65 million, while local participants stepped in to absorb the selling pressure.
On a day-on-day basis, the PSX started the week on a bearish note on Monday as the KSE-100 index fell 882 points, or 0.74%, settling at 118,221 over investor caution ahead of the federal budget and the delay in IMF's approval of circular debt settlement plan.
On Tuesday, the market closed modestly higher with a gain of 112 points as the index oscillated in a narrow band throughout the day. Investors were wary ahead of the budget presentation, although cement stocks rose, driven by hopes for announcement of a real estate package. The bourse opened with renewed vigour on Thursday following a day's closure to mark Youm-e-Takbeer, which reflected the nation's nuclear achievements. The KSE-100 posted a notable rise of 638 points.
Finally, the PSX closed the week on a bullish note on Friday, lifted by strong gains in blue-chip oil, banking and fertiliser stocks amid growing optimism about the upcoming budget measures. The index surged 720 points and settled at 119,691.
Arif Habib Limited (AHL) wrote that the KSE-100 index displayed mixed trends throughout the week, beginning on a negative note due to uncertainties surrounding the budget rollout. On the economic front, China committed to refinancing $3.7 billion of commercial loans for Pakistan.
Moreover, Nepra approved K-Electric's multi-year tariff at Rs39.9/unit and a 14% USD-based return on equity. The government successfully raised Rs772 billion through a T-bill auction, exceeding its target of Rs650 billion. Cut-off yields declined across all tenors, falling by 9 to 15 basis points (bps). The State Bank's reserves climbed up by $70 million to $11.5 billion. The market closed at 119,691, depicting a rise of 588 points, or 0.49% week-on-week (WoW), AHL said.
Sector-wise, the positive contribution came from cement (317 points), fertiliser (249 points), power generation and distribution (148 points), commercial banks (84 points) and refinery (80 points). Meanwhile, the sectors that contributed negatively were automobile assembler (105 points), oil and gas exploration companies (97 points), technology and communication (53 points), food and personal care (46 points) and oil and gas marketing companies (43 points).
Scrip-wise, the positive contributors were Meezan Bank (230 points), Fauji Fertiliser Company (210 points), Lucky Cement (159 points), Pakgen Power (80 points) and DG Khan Cement (70 points). Average volumes arrived at 662 million shares (up 34.6% WoW) while average traded value settled at $78.9 million (down 6.5%), AHL added.
"The KSE-100 index recovered during the week, closing at 119,691 points (up 0.5% WoW)," said Syed Danyal Hussain of JS Research. Foreign investors remained net sellers during the week, with an outflow of $5.57 billion, which was offset by local buying.
The week commenced with the IMF concluding its visit to Pakistan without reaching an agreement on certain budget items, leading the government to reschedule the budget presentation to June 10, 2025, he said. Virtual negotiations were continuing, with both sides focusing on measures to enhance tax revenues and curtail expenditures. Meanwhile, Hussain added, China reaffirmed its commitment to refinancing $3.7 billion in commercial loans denominated in renminbi before the end of June. In other news, the State Bank's net buying from currency markets reached $223 million in February 2025 to further strengthen foreign exchange reserves, bringing the cumulative purchases to $5.9 billion during 8MFY25.
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