Karachi, March 30, 2025 – The Pakistan Stock Exchange (PSX) will conduct only two trading sessions in the week following Eid-ul-Fitr, as market activity remains limited due to public holidays.
The government has declared Eid-ul-Fitr holidays from March 31 to April 2, resulting in a shortened trading week. Additionally, the PSX was closed on Friday, March 28, in observance of the last Friday of Ramadan.
During the preceding week, the PSX exhibited a mixed performance, but analysts predict a positive trend in the upcoming two-day trading session post-Eid-ul-Fitr. A report by Arif Habib Ltd. indicated that market sentiment is likely to remain upbeat, driven by expectations of a historic low inflation rate. The Consumer Price Index (CPI) is projected to rise by only 0.79 per cent, marking the lowest increase in six decades, which could provide a boost to investor confidence at the PSX.
The report also highlighted key stocks expected to perform well at the PSX, including PSO, OGDC, PPL, FFC, FCCL, MLCF, LUCK, NBP, AKBL, SYS, AIRLINK, and HTL. The KSE-100 index is currently trading at a price-to-earnings ratio (PER) of 6.4x for 2025, below its 10-year average of 8.0x, while offering an attractive dividend yield of approximately 8.2 per cent compared to its long-term average of 6.5 per cent.
The market saw fluctuations during the previous week, initially declining due to proposed royalty hikes for cement companies and concerns raised by the IMF regarding tariff adjustments. However, sentiment improved following Pakistan’s staff-level agreement with the IMF for the first review of the Extended Fund Facility (EFF) program, which will unlock a $1 billion tranche. Additionally, a new 28-month Resilience and Sustainability Facility (RSF) agreement worth $1.3 billion was signed, further stabilizing investor outlook at the PSX.
At the close of the week, the KSE-100 index stood at 117,807 points, reflecting a decline of 635 points (0.5 per cent WoW). Average daily trading volume surged by 38 per cent to 317 million shares, with the total traded value reaching $87 million, marking a 27 per cent increase.
Foreign investors continued buying, recording a net inflow of $3.92 million, compared to a net sell of $7.96 million in the previous week. Major buying activity was seen in the oil marketing sector ($4.2 million), while insurance companies led local selling, offloading $10.5 million worth of stocks.
Sector-wise, the PSX witnessed negative contributions from fertilisers (-333 points), technology (-280 points), cement (-196 points), leather & tanneries (-107 points), and textiles (-54 points). Key negative contributors included FFC (-239 points), SYS (-198 points), SRVI (-107 points), EFERT (-106 points), and CHCC (-106 points). Meanwhile, positive contributions came from banking (488 points), pharmaceuticals (76 points), exploration & production (72 points), and tobacco (41 points), with UBL (462 points), HUBC (169 points), OGDC (115 points), MEBL (112 points), and PAKT (41 points) driving gains.
Nabeel Haroon of Topline Securities noted that the KSE-100 index rose by 4.0 per cent on a month-on-month basis, attributed to Pakistan’s IMF agreement, progress on circular debt resolution, and potential government plans to lower electricity prices. On the economic front, GDP grew by 1.73 per cent YoY in Q2FY25, while H1FY25 GDP growth stood at 1.54 per cent, down from 2.33 per cent in H1FY24.
In the latest T-bill auction, the State Bank of Pakistan (SBP) raised Rs640 billion, slightly below its Rs650 billion target. Other key economic developments included a February CPI reading of 1.5 per cent—its lowest level in 113 months—the SBP’s decision to maintain the policy rate at 12 per cent, and remittances of $3.1 billion for February, reflecting a 39 per cent YoY and 4.0 per cent MoM increase.
With a shortened trading week post-Eid-ul-Fitr, analysts anticipate cautious but optimistic investor participation at the PSX, with market sentiment closely tied to economic indicators and government policies.