Karachi, October 4, 2025 – The Pakistan Stock Exchange (PSX) maintained its bullish momentum this week, with the benchmark KSE-100 Index registering another record-breaking performance.
The index gained a substantial 6,733 points or 4.15% on a week-on-week basis during the trading period from September 29 to October 3, closing at 168,990 points.
According to a market commentary by Arif Habib Limited, the rally was supported by macroeconomic developments, with the Consumer Price Index (CPI) for September 2025 clocking in at 5.6% year-on-year compared to just 3.0% in August 2025. While inflationary pressures resurfaced, equity markets showed resilience, as investors remained optimistic about corporate earnings and foreign inflows.
In the government securities market, the latest T-Bill auction witnessed a rise in yields by 19–40 basis points. The State Bank of Pakistan (SBP) raised PKR 730.4 billion against a target of PKR 750 billion, with strong participation of PKR 1,494.7 billion. This reflected robust liquidity in the financial system, providing support to the KSE despite higher borrowing costs.
Sectoral data also contributed to market optimism. Cement dispatches in September rose 7.05% year-on-year to 4.25 million tons, pushing first quarter FY26 volumes to 12.16 million tons, a 16.3% increase compared to last year. Fertilizer trends remained mixed, with urea sales up 17% to 429,000 tons while DAP sales plunged 47%, reflecting weak farm economics. Petroleum sales were also encouraging, rising 8% year-on-year to 1.37 million tons in September.
On the external side, Pakistan’s trade deficit widened to USD 3.3 billion in September 2025. Exports stood at USD 2.5 billion, down 11.7% year-on-year, while imports rose sharply to USD 5.8 billion. This pushed the first-quarter FY26 trade gap to USD 9.4 billion, nearly 33% higher compared to the same period last year.
Despite external challenges, foreign exchange reserves improved slightly to USD 19.80 billion, while the Pakistani rupee appreciated marginally by 0.03%, closing at 281.37 against the dollar.
Market analysts believe that the KSE-100 Index still offers attractive valuations, trading at a forward PER of 8.50x for 2026 against its 15-year average of 8.59x. With a dividend yield of around 6.0%, the Index continues to draw both domestic and foreign investors, who remain focused on upcoming IMF talks that could define the near-term trajectory of the KSE.