Moaaz Manzoor

The Pakistan Stock Exchange (PSX) ended the outgoing week on a firm footing as the benchmark KSE-100 Index settled at 158,037 points, posting a net weekly gain of 3,598 points or 2.33 percent. Improved sentiment from the recently signed Saudi-Pakistan defence pact and supportive macroeconomic indicators underpinned the rally.

Average daily trading volumes rose 2.3 percent week-on-week (WoW) to 1,544 million shares, while average traded value slipped 3.5 percent to $178 million. In terms of scrip-wise contributions, HUBC (+442 points), Bank of Punjab (+394), Lucky Cement (+266), Systems Ltd (+245), and Engro Holdings (+218) fueled the upside. On the flip side, United Bank (-66), HBL (-47), Habib Metropolitan Bank (-31), PKGP (-26), and Askari Bank (-22) dragged the index slightly lower.

By sector, major support came from cements, banks, technology, power, and exploration & production, which collectively added 2,423 points. Minor negative contributions were seen from leather, paper, textiles, and allied industries.

The week was not without volatility. On Friday, the index spiked to an intraday high of 159,337 points (+1,384) before slipping to 157,522 (-432), finally recovering to close just above the 158k mark. Liquidity remained robust, with more than 2 billion shares changing hands, valuing PKR 69.2 billion. Cnergyico emerged as the volume leader, clocking 170.2 million shares.

Macroeconomic indicators provided mixed signals. Pakistan’s current account deficit narrowed to $245 million in August from $379 million in July, though it was higher than $82 million recorded in the same month last year. For 2MFY26, the shortfall reached $624 million versus $430 million in the corresponding period of FY25.

Large-scale manufacturing (LSM) output jumped 8.99 percent year-on-year (YoY) in July and 2.6 percent month-on-month (MoM). Power generation grew 8 percent YoY to 14,218 GWh, while IT and technology exports stood at $337 million, up 13 percent YoY but down 5 percent MoM, accounting for half of services exports. Meanwhile, SBP foreign exchange reserves increased by $20.9 million to $14.4 billion, and the rupee inched up 0.03 percent to close at 281.46 against the US dollar.

Looking ahead, analysts expect consolidation near current levels as investors eye key triggers. AKD Securities projects the benchmark index could touch 165,215 points by December 2025, supported by strong fertilizer earnings, resilient bank returns, and improving cash flows of exploration & production firms and oil marketing companies (OMCs), helped by an easing interest rate cycle. Its top picks include OGDC, PPL, PSO, FFC, Engro Holdings, MCB, Lucky Cement, DG Khan Cement, Fauji Cement, Indus Motors, and Systems Ltd.

Ali Najib, Deputy Head of Trading at Arif Habib Ltd, termed the week “a true roller coaster ride,” highlighting Friday’s wide swings but stressing that the index’s ability to defend the 158k level was “a clear sign of resilience.” With the IMF review scheduled for September 25 and circular debt developments in focus, analysts believe a breakout above the 158k consolidation band could push the PSX to fresh record highs in the final quarter of 2025.

Credit: INP-WealthPk