KARACHI: The Pakistan Stock Exchange (PSX) experienced a strong rebound and recorded its highest week-on-week (WoW) gain in five years, following the announcement of a ceasefire between Pakistan and India, which fuelled a significant market rally during the week ending May 16, 2025.
The benchmark KSE-100 Index surged by 12,474 points, or 11.6 percent week-on-week (WoW), closing at 119,649 points up from 107,174.64 points in the previous week. Average daily trading volumes also saw a notable increase, rising 30 percent WoW to 559 million shares, compared to 508 million shares the week before.
The average daily traded value on the ready counter also increased from Rs 27.6 billion to Rs 38.60 billion. Total market capitalization mounted up by Rs 1.497 trillion, settling at Rs 14.390 trillion versus Rs 12.893 trillion a week earlier.
BRIndex100 also gained 1,560 points during the last week to close at 12,827.18 points compared to 11,267.56 points a week earlier. Average daily turnover at BRIndex100 was 573 million shares. BRIndex30 surged by 5,596 points on a week-on-week basis to 37,832 points with the daily average share trading volumes of 365 million.
According to AHL Research, the KSE-100 index took a sharp turn and skyrocketed into the green zone on Monday, hitting the upper cap of the circuit breaker. The index posted a historic DoD gain of 10,123pts or 9.45 percent-the highest ever in both absolute and percentage terms.
The rally followed a ceasefire announcement between India and Pakistan, brokered by US, who also expressed intentions to enhance trade ties with both countries. In addition, Pakistan also secured IMF’s approval of $1 billion under the EFF and $1.4 billion under the RSF.
On the macro front, CA posted a surplus of USD 1,880mn in 10MFY25. LSMI output grew 1.79percentYoY in Mar’25. In the T-Bill auction (first post-MPC), SBP raised PKR 664bn vs a target of PKR 550bn, while yields dropped sharply by 66–90bps across all tenors. Additionally, MSCI added 3 Pak companies to the FM Index and 4 to the FM Small Cap Index.
All these indicators reflected strong positive momentum, driving the KSE-100 past the 119k level to close at a new all-time high on Thursday. SBP reserves rose by $71 million WoW to $ 10.4 billion. Overall, the KSE-100 was the best-performing market on a WoW basis, posting its highest WoW gain in five years.
Sector-wise positive contributions came from Banks (2,711pts), E&Ps (1,937pts), Fertilizer (1,338pts), Cement (1,249pts), and Tech (666pts). Meanwhile, the sectors that contributed negatively were Leasing (0.03pts) and Woollen (0.90pts). Scrip-wise positive contributors were UBL (922pts), FFC (876pts), PPL (750pts), OGDC (581pts), and LUCK (519pts). Whereas, scrip-wise negative contributions came from PKGP (15pts), IBFL (4pts), NESTLE (2pts) and PGLC (0.03pts).
Foreigner selling was witnessed during this week clocked in at USD 9.13mn compared to a net buy of $ 1.52 million last week. Major selling was witnessed in E&Ps ($ 5.98 million) followed by All other sectors ($2.87 million). On the local front, buying was reported by Mutual Funds ($ 36.03 million) and Insurance Companies ($6.59 million).
Other major news included the country witnessed net FDI inflow of $ 141 million during Apr’25, the price of HSD has decreased by Rs 2.00/liter, technology exports went up by 2 percent YoY during Apr’25 to $ 317 million, banking sector deposits increased by 13.7percentYoY in Apr’25, and the auto sales numbers declined to 10.6K units, down by 5 percent MoM in Apr’25.
Analysts at JS Global said that the surge was primarily driven by easing geopolitical tensions between Pakistan and India, boosting investor confidence. Approval of IMF’s first review, green light for the Resilience and Sustainability Facility, and then the disbursement of $1.02 billion tranche boosted market sentiments.
Furthermore, the current account balance for Apr-2025 recorded a surplus of $12 million, lower than the same period last year due to higher imports. Cumulatively, the CA remained at a surplus of $1.88 billion during 10MFY25.
In other news, Pakistan has initiated virtual technical-level discussions with the IMF on the upcoming FY26 budget, with formal policy-level negotiations to commence next week. Government has also approved the phased privatization plan of 24 SOEs, including PIA.
As per the PBS data, LSM index recorded a 1.8percentYoY increase in Mar-2025, marking a return to positive growth after four consecutive months of YoY decline. In the recently held T-bill auction, SBP raised Rs664 billion against a target of Rs550 billion, with yields witnessing a significant decline of 66 to 90bps across different maturities.
Copyright Business Recorder, 2025
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