Karachi, March 14, 2026 – Pakistan’s benchmark KSE-100 Index experienced a turbulent trading week ending March 13, 2026, falling by 3,630 points amid heightened geopolitical tensions and fluctuating global commodity prices.
According to a market commentary issued by Arif Habib Limited, the index remained highly volatile throughout the week. The market witnessed a sharp decline on Monday after a surge in global oil prices triggered by escalating tensions between the United States and Iran. Although the market recovered some losses during subsequent sessions, the index ultimately closed the week at 153,866 points, down 2.30% week-on-week.
Monetary policy stance
During the week, the State Bank of Pakistan maintained its policy rate at 10.5%, signaling a cautious approach as policymakers monitor the impact of geopolitical developments and volatility in global commodity markets.
Key economic indicators
Several economic indicators released during the week also influenced investor sentiment:
• Petroleum sales rose 13% year-on-year to 1.28 million tons in February 2026, supported by stronger demand for motor spirit (MS) and high-speed diesel (HSD). However, sales declined 15% month-on-month due to fewer days in February and reduced activity during Ramadan. Cumulative sales during 8MFY26 increased 4% YoY to 10.96 million tons.
• Refinery throughput grew 29% YoY in February 2026, while cumulative volumes for 8MFY26 rose 12.5% YoY to 7.1 million tons, reflecting higher fuel consumption.
• Cement prices in northern regions increased by Rs60 per 50kg bag, reaching around Rs1,480, mainly due to rising fuel and energy costs.
• Workers’ remittances climbed 5% YoY to $3.3 billion in February 2026, although they declined 5% MoM. Total inflows during 8MFY26 increased 10% YoY to $26.5 billion.
• Automobile sales dropped 26% MoM to 17,100 units in February, largely due to the Ramadan slowdown and normalization after strong sales in January. However, cumulative sales for 8MFY26 surged 43% YoY to 128,500 units.
Trade and currency update
Pakistan’s trade deficit stood at $3.0 billion in February 2026, with exports recorded at $2.3 billion and imports at $5.3 billion. Cumulative trade deficit for 8MFY26 widened 25.3% YoY to $25.1 billion.
Meanwhile, the country’s foreign exchange position improved slightly. The State Bank of Pakistan reported that its reserves increased by $41.1 million to $16.3 billion, while reserves held by commercial banks rose by $123.3 million to $5.2 billion during the week.
The Pakistani rupee remained largely stable against the US dollar, appreciating marginally by 0.03% week-on-week to Rs279.31 per dollar.
Market outlook
Analysts believe the performance of the KSE-100 Index next week will depend largely on geopolitical developments, particularly tensions in the Middle East. Additionally, the approaching Eid holidays could influence trading volumes and investor participation.
Currently, the KSE-100 Index is trading at a price-to-earnings (P/E) ratio of around 7.7x, offering an attractive dividend yield of approximately 6.6%, which analysts say may continue to support long-term investor interest in Pakistan’s equity market.