Karachi, December 20, 2025 — The Pakistan Stock Exchange (PSX) closed the week ending December 19 on a positive note, with the benchmark KSE-100 Index rising 0.91% week-on-week (WoW).
According to market analysts at Arif Habib Limited, the index climbed from 169,865 last week to 171,405 this week, posting a gain of 1,540 points. Investor sentiment was buoyed by the 50 basis points policy rate cut announced on Monday, which spurred optimism across key sectors.
Economic indicators also supported the market’s positive trajectory. Pakistan recorded a current account surplus of USD 100 million in November 2025, compared to a surplus of USD 709 million in November 2024 and a deficit of USD 291 million in October 2025. During the first five months of FY26, the current account deficit reached USD 812 million. Meanwhile, net foreign direct investment (FDI) inflow remained steady at USD 180 million for November 2025, slightly up from USD 179 million in October.
The government’s debt instruments also saw strong participation, with the T-bill auction raising PKR 445 billion against a target of PKR 400 billion. Cut-off yields fell 25–70 basis points across all tenors in the first Pakistan Investment Bonds (PIB) auction following the policy rate cut, with the largest allocation of PKR 116.9 billion going to the 2-year PIB.
In other sectors, power generation remained stable year-on-year, while auto financing surged 35.5% YoY to PKR 318 billion in November. Industry urea offtake reached its highest level for any November since 2010, reducing inventory from 1.40 million tons in October to 1.14 million tons in November.
The State Bank of Pakistan’s foreign reserves increased by USD 1.3 billion to USD 15.9 billion, while commercial bank reserves rose by USD 0.2 billion to USD 5.2 billion. The Pakistani rupee appreciated slightly, closing at PKR 280.25/USD, up 0.023% WoW.
Looking ahead, market sentiment is expected to remain largely positive, although upcoming rollover activities may trigger short-term selling pressure. The KSE-100 currently trades at a PER of 8.67x with a dividend yield of approximately 5.61%, compared to historical averages of 8.80x and 6.18%, respectively. Top stock picks for investors include OGDC, PPL, MCB, NBP, SYS, SAZEW, MUGHAL, FCCL, MLCF, and PSO.