KARACHI: The stock market faces another uncertain week as Middle East tensions and approaching corporate results season keep investors on edge. The KSE-100 Index shed 1,309 points, or 0.9 per cent, over the week to close at 150,399 points, extending its losing streak to a tenth consecutive week.
AKD Research said market sentiment would hinge on developments in the Middle East conflict. The brokerage noted that an eventual de-escalation could spark a strong rebound, as recent corrections have made valuations more attractive, with the forward price-to-earnings ratio now standing at 6.4 times. Upcoming corporate results for the third quarter of fiscal year 2026 would also remain in focus, AKD Research added.
The index swung sharply during the week, touching a high of 157,347 points before sliding to a low of 144,657 points, as Ali Najib, deputy head of trading at Arif Habib Ltd, noted. He said the benchmark respected a key near-term pivot level at 150,000 despite the sustained pressure.
Geopolitical developments drove most of the volatility. Optimism built in the first half of the week on Pakistan’s diplomatic efforts towards de-escalation, lower-than-expected inflation and a staff-level agreement with the International Monetary Fund. Pakistan secured a $1.2 billion tranche under the IMF’s Extended Fund Facility and Resilience and Sustainability Facility, subject to board approval. However, conflicting statements from Iran and the United States, along with fears of a possible ground invasion, weakened confidence in the latter part of the week.
Syed Danyal Hussain, an analyst at JS Research, said Brent crude remained above $100 per barrel throughout the week, adding to pressure on the market. He noted that inflation came in at 7.3 per cent year-on-year in March 2026, the highest reading since August 2024, bringing average nine-month fiscal year 2026 inflation to 5.7 per cent. The Federal Board of Revenue collected Rs1.2 trillion in taxes during March, falling short of its target by Rs182 billion, while cumulative nine-month collection reached Rs9.9 trillion, missing the target by Rs610 billion.
On the macroeconomic front, Pakistan’s economy grew 3.9 per cent year-on-year (YoY) in the second quarter of fiscal year 2026, up from 3.6 per cent in the previous quarter, driven by a recovery in industrial output of 7.4 per cent. The government ended its fuel subsidy regime by raising petrol prices by Rs137 per litre and diesel by Rs184 per litre. Petrol prices were reduced again by Rs80 per litre by the prime minister. The State Bank of Pakistan’s foreign exchange reserves rose by $6 million to $16.4 billion as of March 27. The trade deficit for March 2026 widened 4.0 per cent YoY to $2.7 billion.
Average daily traded volumes fell 31 per cent week-on-week (WoW) to 604 million shares, reflecting subdued participation. Mutual funds were the largest net sellers, offloading $15.7 million, while individual investors absorbed most of the selling with net purchases of $16.7 million.
Among sectors, refineries, woollen textiles and transport led gains, rising 11.1 per cent, 5.3 per cent and 3.6 per cent respectively. Vanaspati and allied industries, leather and tanneries, and cable and electrical goods were the worst performers, declining 6.6 per cent, 6.4 per cent and 5.9 per cent. TRG topped individual stock gainers, rising 16.1 per cent, followed by CNERGY at 11.4 per cent, ATRL at 9.0 per cent, BAHL at 6.6 per cent and BAFL at 6 per cent. Standard Chartered Bank Pakistan led declines, falling 12.8 per cent, followed by GADT at 12.3 per cent, KTML at 10 per cent, SSOM at 9.7 per cent and PAEL at 9.4 per cent.
