By Recorder Review

Copyright brecorder

KARACHI: The Pakistan Stock Exchange (PSX) sustained its bullish momentum throughout the outgoing week, with the benchmark KSE-100 index surging 3,597.68 points, or 2.3 percent, to settle at 158,037.37 points compared to 154,439.69 points a week earlier.

The index touched a weekly high of 159,337 points, marking one of the strongest rallies of the year as investor confidence was buoyed by a combination of domestic and external triggers.

The BRIndex100 gained 476.66 points to close at 16,315.72, while the BRIndex30 jumped 3,414.51 points to 52,343.51. Average daily turnover stood at 1,306.41 million shares for BRIndex100 and 838.39 million shares for BRIndex30, highlighting robust participation in blue-chip counters.

Trading activity was exceptionally strong, with average daily traded volume (ADTO) on the ready board soaring 41.4 percent to 1.54 billion shares from 1.09 billion last week. According to AKD Securities, this represented the second-highest weekly traded volume ever recorded. Ready-board traded value averaged Rs50.21 billion, reflecting sustained interest from both retail and institutional investors.

Market capitalization added Rs381.65 billion to reach Rs18.57 trillion, a weekly gain of 2.1 percent. In dollar terms, market cap stood at USD 65.99 billion, aided by a slight appreciation of the rupee against the dollar.

Technology & Communication led the rally, advancing 9.6 percent, followed by Mutual Funds (7.1 percent) and Refineries (6.4 percent). Leasing, textile spinning, and engineering sectors lagged, losing between 0.2 and 1.1 percent week-on-week.

Among individual performers, Bank of Punjab (BOP) emerged as the week’s standout gainer, soaring 47.4 percent to Rs26.26. TRG Pakistan climbed 28.5 percent, while Cnergyico PK and YOUW gained 13.9 percent and 13.1 percent respectively. On the downside, Pakgen Power (PKGP) fell 4.9 percent, International Steels (ISL) lost 3.8 percent, and KAPCO shed 3.5 percent.

Foreign investors were net sellers of USD 20.8 million during the week, but mutual funds and insurance companies absorbed most of the selling with combined net purchases of USD 24 million, helping sustain upward momentum.

Market sentiment was boosted by optimism surrounding the upcoming International Monetary Fund (IMF) review mission, with investors expecting a favourable assessment of Pakistan’s fiscal measures aimed at mitigating flood-related economic damage. “The week opened with the IMF signalling that its review will assess whether the government’s fiscal measures are sufficient to address prevailing challenges,” JS Research noted. Reports that the government is considering Rs50 billion mini-budget and lobbying for Rs300 billion downward revision in FBR’s FY26 tax collection target further supported equities.

Adding to the optimism was the positive political backdrop following the recently signed Pakistan–Saudi Arabia Strategic Mutual Defence Agreement, which analysts said improved investor sentiment.

On the monetary front, the State Bank of Pakistan kept the policy rate unchanged at 11 percent in its latest MPC meeting, citing potential economic headwinds from flood-related disruptions.

Large-Scale Manufacturing (LSM) posted a robust 9 percent year-on-year growth in July 2025, driven by a 58 percent surge in auto production on a low base.

Despite the rally, external account pressures persisted. Pakistan’s trade deficit widened to USD 2.5 billion in August, pushing the current account deficit to USD 245 million. Exports, however, showed resilience, rising 13 percent year-on-year to USD 3.37 billion, while remittances provided some cushion. Foreign direct investment (FDI) fell 22 percent year-on-year to USD 156 million during the first two months of FY26.

Electricity generation in August stood at 14,218 GWh, down 8 percent year-on-year, though coal-based generation surged 180 percent, partially offsetting the decline in hydel and gas-based power output.

With the IMF review approaching and progress anticipated on circular debt management, analysts expect the index to maintain its upward trajectory. Many believe the KSE-100 could soon breach the psychological 160,000-point barrier if macroeconomic stability and investor confidence persist.

Copyright Business Recorder, 2025