Moaaz Manzoor

The Pakistan Stock Exchange (PSX) witnessed a fourth consecutive bearish week as persistent selling pressure and geopolitical risks weighed heavily on investor sentiment, pushing the benchmark index sharply lower.

The KSE-100 Index closed at 173,170, down 3.6% week-on-week. During the week, the index lost 6,434 points (down 3.58%). It opened at 179,927, touched an intra-week high of 179,969, slipped to a low of 169,593, and eventually settled at 173,170.

The market has now fallen 15,997 points from its January 2026 peak of 189,167, marking an 8.5% decline and indicating a notable correction.

According to Arif Habib Limited (AHL), sector-wise negative contributions were led by Banks (1,044 points), followed by Fertilizer (931 points), Cement (814 points), Investment Banks (599 points), and OMCs (509 points). On the positive side, Automobile Parts contributed 48 points, followed by Vanaspati & Allied (2 points), Woollen (0.11 points), Sugar (0.04 points), and Synthetic & Rayon (0 points).

On a stock-specific basis, major drags on the index included FFC (690 points), ENGROH (510 points), PSO (428 points), LUCK (363 points), and PIOC (271 points). Meanwhile, positive contributions came from THALL (48 points), INIL (31 points), PTC (6 points), NESTLE (5 points), and MUREB (3 points).

Market activity weakened over the week, with average volumes declining 24% WoW to 654 million shares, while average traded value fell 12% WoW to USD 134 million.

Commenting on market performance, Ali Najib, Deputy Head of Trading at Arif Habib Ltd, said the PSX exhibited consolidation around the 172,000 level, with the KSE-100 Index closing at 173,170, up 999 points (+0.58%) in the last session. He noted that despite the relatively short trading session, volatility remained elevated as the benchmark moved within a wide intraday range of approximately 4,500 points, touching a high of 174,148 (+1,978 points; +1.15%) and a low of 169,593 (-2,578 points; -1.58%).

He added that the 170,000 level acted as a strong support zone, with the market staging a rebound after hitting an intraday low. Going forward, the index is expected to remain range-bound between 170,000 and 180,000, with 170,000 serving as key support and 180,000 as immediate resistance.

AHL stated that the direction of the KSE-100 next week will depend on geopolitical developments, while the ongoing results season could provide upside momentum if corporate earnings surprise positively. Any constructive outcome from the IMF visit scheduled for next week may also support sentiment. The index is currently trading at a price-to-earnings ratio of 8.7x, offering a dividend yield of approximately 5.6%. AHL’s top picks include MEBL, NBP, FFC, OGDC, PPL, FCCL, KOHC, NPL, NCPL, SYS, AIRLINK, PSO, SAZEW, INDU, and PAEL.

Meanwhile, AKD Securities expects the market to recover as domestic and geopolitical uncertainties subside, noting that valuations remain attractive at a forward PE of 7.3x and dividend yield of 6.4%. The brokerage anticipates improved investor sentiment on the likelihood of foreign portfolio and direct investment inflows driven by improved relations with the US and KSA. Its preferred stocks include OGDC, PPL, UBL, MEBL, HBL, FFC, ENGROH, PSO, LUCK, FCCL, INDU, ILP, and SYS.

Credit: INP-WealthPk