PSX slips 0.3% as selling offsets early gains

KSE-100 remains range bound amid profit-taking, policy uncertainty

KARACHI:

The Pakistan Stock Exchange (PSX) remained range bound during the outgoing week as mixed investor sentiment and intermittent profit-taking offset early gains driven by easing regional tensions and positive macroeconomic cues. The KSE-100 index closed at 163,304, down 502 points, or 0.31% week-on-week (WoW).

On a day-on-day basis, after three consecutive negative sessions, the PSX recommenced the week with a sharp rebound as the KSE-100 index surged by 2,437 points (+1.49%) to close at 166,243.

Bulls stormed back on Tuesday as the index rallied 1,103 points to close at 167,346, driven by renewed investor optimism post-ceasefire announcement over the last weekend.

However, on Wednesday, the PSX witnessed range-bound trading, where investors adopted a cautious stance. The index oscillated between gains and losses before settling at 166,553, down 794 points. Thursday was a day of correction, therefore, the PSX witnessed a turbulent session, slipping 1,962 points to settle at 164,590.

Finally, the bourse extended its corrective spell as the KSE-100 lost further ground, shedding 1,286 points to close at 163,304 on Friday.

Arif Habib Limited (AHL), in its weekly report, highlighted that the KSE-100 index largely remained range bound throughout the week, reflecting a mixed investor sentiment. The week commenced on a positive note, driven by easing geopolitical tensions and encouraging macroeconomic indicators, particularly the current account surplus for September 2025, which boosted market confidence.

However, the momentum could not be sustained as the week progressed, with investors resorting to profit-taking. Consequently, the index closed the week at 163,304.13, marking a decline of 502 points (0.31% WoW).

During Sept'25, AHL mentioned, the current account posted a surplus of $110 million versus a deficit of $52 million in Sept'24 and $325 million in Aug'25. For 1QFY26, the deficit stood at $594 million, up from $502 million last year. Pakistan's Real Effective Exchange Rate (REER) rose to 101.73 in Sept'25 from 100.09 in Aug'25, up 1.64% month-on-month (MoM), 3.77% FY26 to date and down 1.87% CY25 to date.

Net foreign direct investment (FDI) stood at $186 million in Sept'25 vs $175 million in Aug'25. In 1QFY26, inflows fell 34% to $569 million from $865 million in 1QFY25. Profit and dividend repatriation rose 22.5% YoY but fell 54.4% MoM to $159 million in Sept'25. In 1QFY26, it surged 85.8% YoY to $751.7 million.

Oil production fell 6.9% WoW to 60,797 barrels per day, while gas output declined 3.1% WoW to 2,864 million cubic feet per day, driven by lower production from Nashpa, Makori East and Sui. Power generation in Sept'25 rose 0.8% YoY to 12,592 gigawatt hours (GWh), below the reference of 13,300 GWh. In 1QFY26, generation reached 40,933 GWh, up 1% YoY. Generation cost dropped 15% YoY to Rs7.09/kWh, driven by lower oil prices as Brent declined 7.1% YoY, AHL added.

Wadee Zaman of JS Global noted that the KSE-100 index started the week on a strong note, climbing to the intra-day high of 168,414 points following news of easing tensions between Pakistan and Afghanistan after a ceasefire agreement reached in Doha. However, the momentum faltered later in the week, with the index closing at 163,304, remaining largely unchanged (-0.3%) on a WoW basis.

On the economic front, he said, the IMF cautioned that the impact of recent floods may be greater than initially anticipated, potentially weighing on growth, inflation and the current account outlook. In macro developments, Pakistan recorded a current account surplus of $110 million in Sept'25, bringing the 1QFY26 deficit down to $594 million.

Meanwhile, the federal government was preparing a three-year power tariff relief package aimed at lowering electricity rates on incremental consumption for agricultural and industrial consumers from the current Rs38/kWh and Rs34/kWh, respectively, to Rs22.98/kWh. In other developments, IT exports rose 25% YoY to $366 million in Sept'25, taking total 1QFY26 exports to $1.1 billion, up 21% YoY. Lastly, SBP's foreign exchange reserves rose $14 million to $14.55 billion, he added.