By Moaaz Manzoor
ISLAMABAD, October 26 (Wealth Pakistan): The benchmark KSE-100 Index of the Pakistan Stock Exchange (PSX) declined by 502 points, or 0.31 percent week-on-week, closing at 163,304.13 as investors booked profits after recent gains and awaited the upcoming monetary policy decision and IMF board review.
The index opened at 164,912, touched a high of 168,414, and dipped to a low of 163,042 before stabilizing near the 163,000 mark. Analysts said the movement reflected consolidation after several weeks of upward momentum.
Trading activity eases amid cautious sentiment
Average trading volumes fell 18.8 percent week-on-week to 1.48 billion shares, while the average traded value dropped 10.6 percent to 177 million dollars. K-Electric (KEL) led the activity with 194.8 million shares traded.
Sector-wise, Exploration and Production (E&P) stocks contributed the most to market resilience, adding 404 points to the index. Investment Banks added 184 points, followed by Miscellaneous (132 points), Leather and Tanneries (79 points), and Fast-Moving Consumer Goods (76 points).
The main drags came from the Banking sector (-502 points), Power (-415 points), Cement (-338 points), Refinery (-76 points), and Automobile Assemblers (-57 points).
Economic indicators remain broadly stable
Macroeconomic data showed stability across major fronts. The current account posted a surplus of 110 million dollars in September 2025, compared to a deficit of 52 million dollars a year earlier and 325 million dollars in August 2025.
However, the first quarter of FY26 recorded a deficit of 594 million dollars, slightly higher than 502 million dollars in the same period last year. The Real Effective Exchange Rate (REER) rose 1.64 percent month-on-month to 101.73 in September from 100.09 in August.
Foreign Direct Investment improved modestly to 186 million dollars in September from 175 million dollars in August. Despite this, inflows for the first quarter of FY26 fell 34 percent year-on-year to 569 million dollars.
Profit and dividend repatriation increased 85.8 percent year-on-year to 751.7 million dollars during the quarter, though it dropped 54.4 percent month-on-month to 159 million dollars in September.
Mixed trends in key sectors
Oil and gas production fell 6.9 and 3.1 percent week-on-week respectively, while power generation in September rose 0.8 percent year-on-year to 12,592 gigawatt hours. The average cost of power generation declined 15 percent to 7.09 rupees per kilowatt hour, helped by a 7.1 percent fall in Brent crude prices.
The State Bank of Pakistan’s foreign exchange reserves edged up to 14.45 billion dollars, while the rupee held steady at around 281.02 per US dollar.
Market outlook remains steady
According to Arif Habib Limited (AHL), the KSE-100 Index is currently trading at a price-to-earnings ratio of 8.58x, close to its 15-year average of 8.59x, and offers a dividend yield of 5.5 percent against the historical average of 6.1 percent.
The brokerage expects the State Bank’s Monetary Policy Committee to keep the policy rate unchanged at its meeting on October 27. It noted that selective stocks are likely to remain in focus as the corporate results season continues.
Ali Najib, Deputy Head of Trading at Arif Habib Limited, said the PSX extended its corrective spell as investors realigned positions ahead of the MPC meeting and rollover week. “The index remained under pressure despite active participation, with traded value reaching Rs34.9 billion,” he said.
AKD Securities projected a relatively positive medium-term outlook, supported by improved credit ratings, consistent IMF engagement, and stronger economic ties with the United States and Saudi Arabia. The brokerage expects the KSE-100 to consolidate within the 160,000–165,000 range, with 160,000 serving as a strong technical support level for renewed buying interest.