KARACHI:
The Pakistan Stock Exchange (PSX) wrapped up the week on a bullish note, with the benchmark KSE-100 index breaching the 145,000 mark amid strong institutional buying, handsome corporate earnings and improved macroeconomic sentiment.
Gains were further bolstered by record remittances for July, a sharp jump in textile exports and optimism about government reforms, including a major reduction in circular debt and an ambitious privatisation road map. On a day-on-day basis, the PSX started the week by breaching the 142,000 level, another all-time high, with a rise of 1,018 points as Oil and Gas Development Company (OGDC) received its first term finance certificate (TFC) payment of Rs7.7 billion, signalling strong financial health.
On Tuesday, the market extended gains as the KSE-100 index ended at 143,037, up 985 points. Investor confidence was supported by robust inflows and a nine-year low fiscal deficit of 5.38% for FY25. The record-breaking rally continued next day as well, where the index broke another key psychological level of 145,000, reflecting a surge of 2,051 points.
However, the bourse took a breather on Thursday, closing at 145,647, up a modest 559 points, as Pakistan recorded a trade deficit of $2.8 billion in July. The PSX ended the week by consolidating around 145k on Friday, with the index standing at 145,383, down 264 points. Investors displayed caution, reacting to recent macroeconomic developments by shifting focus across sectors and booking profits selectively.
Arif Habib Limited (AHL) wrote in its review that the KSE-100 index extended its upward trajectory during the outgoing week, closing at 145,383 and posting a week-on-week (WoW) surge of 4,348 points, or 3.1%. The rally was fueled by strong buying from local institutions and funds, along with the ongoing result season.
According to the Ministry of Finance, the overall fiscal deficit narrowed to Rs6.2 trillion (5.4% of GDP) compared to 6.8% in FY24. This progress was driven by robust growth in both tax and non-tax revenues, outpacing the rise in expenditures. Cement dispatches surged 30.1% in July on higher exports and post-Eid demand recovery, AHL said.
In the MSCI Index review for August 2025, one stock (Faysal Bank) was added to the Frontier Market Standard Index, while two stocks (Indus Dyeing and Manufacturing and Jubilee General Insurance) were added and two removed (Habib Sugar Mills and Octopus Digital) from the Small Cap Index, it mentioned. Petroleum sales rose 2% year-on-year (YoY) to 1.22 million tons in July, driven by lower petrol and diesel prices compared to last year. The T-bill auction held on August 6 raised Rs386 billion, below the target of Rs400 billion, with yields increasing 5-30 basis points across all tenors.
In July, workers’ remittances reached $3.2 billion, the highest-ever for the month of July. The State Bank’s foreign exchange reserves fell $72 million to $14.23 billion in the week ended August 8. Meanwhile, the rupee appreciated 0.1% WoW, closing at 282.47 against the dollar, AHL added.
Syed Danyal Hussain of JS Global said that the KSE-100 maintained a bullish tone for most of the week, touching the high of 146,813 before slipping into the red on Friday. The index closed at 145,383, up 3% WoW, while average daily turnover increased 16% to 653 million shares.
Sentiment improved as the US imposed higher tariffs on Indian goods, boosting confidence in export-oriented sectors. The government made progress in the power sector, cutting circular debt by Rs780 billion to Rs1.6 trillion, and unveiled a five-year roadmap to privatise 24 companies in three phases, with 10 companies, including PIA, to be privatised in the first phase, he said.
On the trade front, textile exports jumped 33.7% YoY to $1.69 billion in July 2025, though the overall trade deficit widened sharply by 44% YoY, reaching $2.7 billion due to higher imports. According to the State Bank, its reserves slipped $72 million to $14.2 billion, mainly on external debt repayments, Hussain said.
