PSX benchmark index closes at all-time high

Pakistan Stock Exchange (PSX) sustained its bullish momentum throughout the week. The benchmark index closed the week at all-time high of 131,949 points on Friday, July 04, 2025.

Market participation increased as well, with average daily traded volumes increasing by 31.4%WoW to 967 million shares, up from 736 million shares a week ago.

Market participation improved due to increase in withholding tax (WHT) on profit/ interest from savings and fixed deposits to 20%, while it remained unchanged at 15% for equity investments in the recently approved Finance act, triggering a reallocation of funds, driving flows into the stock market.

Optimism was further supported by a strong external position amid Pakistan receiving a US$3.4 billion loan roll-over from China, in addition to finalizing another US$1.0 billion loan from a Middle Eastern commercial bank and US$500 million from multilateral financing.

These inflows spiked foreign exchange reserves held by State Bank of Pakistan (SBP) to US$14.5 billion by end-June 2025. The SBP was able to meet its goal of closing FY25 at the US$14 billion mark.

PKR remained stable against the greenback throughout the week, closing at PKR283.97/US$.

On the macroeconomic front, trade deficit for June 2025 was recorded at US$2.3 billion, taking FY25 trade deficit to US$26.3 billion, up 9%YoY.

Inflation for June 2025 was recorded at 3.2%YoY as compared to 3.5%YoY for May, taking FY25 inflation to 4.5%YoY.

Cement sales for FY25 were reported at 46.2 million tons, up 2%YoY, driven by higher exports.

OMC offtakes for FY25 grew to 16.3 million tons, up 7%YoY.

Other major news flow during the week included: 1) SBP buys US$6.8 billion from market and 2) Aurangzeb advances strategic partnerships on sidelines of Fourth International Conference for Financing Development in Spain.

Commercial Banks, Textile Spinning, Insurance, and Miscellaneous, were amongst the top performing sectors, while Woollen, Jute, Glass & Ceramics, and Leasing Companies were amongst the worst performers.

Major buying of US$22.2 million was recorded by Mutual Funds. Foreigners were net seller during the week, with a net sell of US$15.3 million.

Top performing scrips of the week were: GADT, AICL, and FABL, while laggards included:  BNWM, GHGL, and PGLC.

According to AKD Securities, the market is expected to remain positive in the coming weeks, with forward inflation for FY26 projected at 4.4%YoY, indicating substantial room for monetary easing, which would serve as a catalyst for equities.

The benchmark index is anticipated to remain on upward trajectory, primarily driven by strong earnings in Fertilizers, sustained ROEs in Banks, and improving cash flows of E&Ps and OMCs, benefiting from falling interest rates and economic stability.

The top picks of the brokerage house include: OGDC, PPL, PSO, FFC, ENGROH, MCB, HBL, LUCK, FCCL, INDU, and SYS

 

 

 

 

 

 

 

 

Pakistan Stock Market remains laclkuster

Due to political uncertainty and regulatory pressures the benchmark of Pakistan Stock Exchange index remained unexciting. The week ending 17^th March 2017 closed at 48,409 points, down 1.6% WoW. Soft global oil prices, SECP’s action to curtail in-house badla financing and political uncertainty kept the market under pressure. Key news flows during the week were: 1) SBP raised Rs284 billion through short‐ term government papers, 2) in line with expectations, the US Fed raised interest rates, 3) in addition to independent power producers’ claims of over Rs414 billion, non‐payments to oil companies were reported at more than Rs300 billion, 4) Ministry of Finance approved payment of Rs6 billion on Thursday for the state owned PSO to avoid an international default, and 5) HUBC and FFC announced in separate notices the offer and receipt of an equity divestment plan relating to Thar Energy Limited. (TEL), a 330MW mine mouth coal fired project in Thar Block II. Stocks leading the bourse were: MEBL, ASTL, FATIMA, and ICI. On the other hand, laggards were: HMB, PPL, and FFBL. Volume leaders were: KEL, BOP, TRG and ASL. Subdued global oil prices, strengthening US$ and global trade related developments over the upcoming G‐ 20 summit may impact the domestic markets. At home, any clarity on the political front could trigger bullish sentiment, while policies and budgetary developments for the Finance Bill FY18 can be expected to sway markets.

The PRK has remained stable over the last year, weathering the worsening external account position. While current account deficit is up 90%YoY during 7MFY17 and reserve position (down US$1.75 billion from its peak) has deteriorated, PkR/US$ has remained stable at PKR104.8/US$, which is reflective of GoP's resolve to keep exchange rate stable. Going forward, analysts see little pressure on the PRK over the short term, primarily supported by an expected recovery in forex reserve position. In this regard, analysts see support from expected inflows including: 1) up to US$1.0 billion from planned Eurobond/Sukuk issue, 2) US$550 million under CSF disbursement and 3) likely US$4.0 billion from project lending and commercial loans budgeted for the year along with room for greater accretion from CPEC related inflows. Incorporating this,

AKD Securities has recently revisited its investment case for PIOC, incorporating recent cement price increase and expected continuation of clinker sales. While rally in coal price is expected to shrink gross margins (GM) and dampen earnings, recently installed 12MW WHR is expected to partially make up for the above. In this regard, the brokerage house expects an after‐tax operational savings of PKR1.11/PKR1.82 in 2HFY17/FY18. Besides, the company revealed its plans of: 1) revising up its cement expansion capacity from 2.21 million tpa to 2.52 million tpa, 2) installing separate line of 12MW WHR for the expansion and (3) setting up 24MW coal CPP. The total capex associated with the projects is expected to be around PKR25 billion. Though, the brokerage house has not incorporated the aforementioned projects due to awaited details, it expects the expansion to result in increase in FY20‐23 average earnings. Moreover, the new line of WHR and coal CPP are together expected to result in incremental earnings.