PSX Loses Fourth Straight Week, KSE-100 Down 670 PointsBusiness

According to AKD Securities, the index recorded its steepest sell-off on Monday, losing 1,965 points after emergency and governor’s rule were imposed in PTI-ruled Khyber Pakhtunkhwa. The market subsequently recovered some of the losses as the initial selling pressure eased.

<h2>Oil prices and geopolitical drag</h2> Brent crude rose to $107 per barrel during the week amid disruptions to energy supplies through the Strait of Hormuz and renewed attacks on Saudi energy infrastructure, despite the International Energy Agency&#8217;s announcement of additional emergency oil reserve releases.

Sector-wise, exploration and production companies led the decline, dragging the index down by 330 points, followed by banks at 319 points, cement at 136 points, investment banks at 109 points and power companies at 76 points. Among individual stocks, Oil and Gas Development Company contributed most to the decline, shedding 161 points, followed by United Bank with 136 points, Habib Bank and Pakistan Telecommunication Company with 111 points each, and Pakistan Oilfields with 95 points.

Fertiliser stocks provided the biggest support, adding 171 points, followed by oil marketing companies with 63 points, refineries with 60 points, pharmaceuticals with 41 points and fast-moving consumer goods companies with 22 points. Fauji Fertiliser Company was the top individual contributor, adding 85 points, followed by Systems Ltd with 81 points, Pakistan State Oil with 62 points, Engro Fertilisers with 60 points and Attock Refinery with 44 points.

Average daily trading volume rose 5.2 per cent to 449 million shares, while average value traded fell 1.5 per cent to $65 million week-on-week.

<h2>Macroeconomic backdrop</h2> On the economic front, the country&#8217;s current account deficit swelled to $356 million in September from $73 million in August and a $123 million surplus a year earlier, driven by a widening trade gap, according to AKD Securities. The cumulative deficit for the first quarter of FY27 reached $874 million, up from $755 million a year ago.

The trade deficit widened 5 per cent year-on-year and 7 per cent month-on-month to $3.53 billion in September. Exports rose 18 per cent year-on-year to $2.96 billion, while imports increased 11 per cent to $6.49 billion. In the first quarter, the trade gap widened 15 per cent to $10.77 billion, with exports at $8.45 billion and imports at $19.21 billion.

Worker remittances increased 13 per cent year-on-year to $3.6 billion in September, while the State Bank&#8217;s foreign exchange reserves rose by $16 million to $21.47 billion as of October 9. The government raised Rs685.5 billion against a target of Rs550 billion in a treasury bills auction, with the three-month tenor attracting the largest amount at Rs310.1 billion.

Automobile sales, including cars, light commercial vehicles, vans and jeeps, fell 3 per cent month-on-month and 12 per cent year-on-year to 15,104 units in September, according to the Pakistan Automotive Manufacturers Association. However, cumulative sales rose 19 per cent to 50,480 units in the first quarter. Large-scale manufacturing grew 0.7 per cent year-on-year in August but declined 5 per cent month-on-month.

Pakistan&#8217;s real effective exchange rate rose to 108.93 in September from 107.92 in August, while the rupee appreciated marginally by 0.03 per cent to close at Rs276.91 against the dollar. According to Arif Habib Ltd, the PSX added a record 25,280 investor accounts in September, taking total unique identification numbers to 656,000, up 55 per cent from a year earlier. Meanwhile, gross inflows under the Roshan Digital Account scheme reached $14.16 billion by September.

Analysts said geopolitical developments and the September-quarter results season, beginning next week, would remain key market drivers. The KSE-100 was trading at a price-to-earnings ratio of 7.4 times, with a dividend yield of 6.8 per cent, and they noted that improving economic indicators and easing inflation could support the market.