The Pakistan Stock Exchange (PSX) is expected to maintain positive momentum, supported by further monetary easing by the central bank, an improving external account position, and continued focus on reforms amid political stability, according to a note by AKD Research.
The brokerage firm said that the investor sentiment is expected to improve on the likelihood of foreign portfolio and direct investment flows, driven by improved relations with the United States and Saudi Arabia.Â
Earlier, the AKD forecasted that the KSE-100 Index is expected to surpass 263,000 mark by December 2026. Furthermore,Â
The market experienced volatility throughout the week ending on Friday, mainly due to escalating geopolitical tensions. However, bullish momentum ultimately prevailed as geopolitical risks eased, alongside reports of defence export deals with multiple regional partners and positive macroeconomic developments. As a result, the KSE-100 Index posted a weekly gain of 689 points (+0.4% WoW) to close at 185,099 points.
Market participation, however, weakened, with average daily traded volume (ADTV) falling 24.5% WoW to 1.2 billion shares, compared to 1.6 billion shares in the previous week.
On the macroeconomic front, the Large-Scale Manufacturing (LSM) index rose 10.4% YoY in November 2025, while recording growth of 6% YoY during 5MFY26. In the latest PIB auction, yields declined by 59bps, 70bps, 66bps and 66bps for the 2-, 3-, 5- and 10-year tenors, respectively, compared to the previous auction.
Meanwhile, the fertiliser sector recorded its highest-ever annual urea sales in CY25, while automobile sales stood at 17,000 units in December 2025, down 6% YoY. State Bank of Pakistan-held foreign exchange reserves increased by $16 million WoW, closing at $16.1 billion as of January 9. On the currency front, the PKR appreciated by 0.03% WoW against the US dollar, ending the week at 279.95 PKR/USD.
Other major news flow during the week included: (1) Turkiye confirming talks on a defence pact with Pakistan and Saudi Arabia; (2) petrol and diesel prices remaining unchanged for the next fortnight as the government increased the petroleum levy; (3) Pakistan announcing plans to develop Port Qasim into a climate-resilient industrial complex; (4) Pakistan and Saudi Arabia exploring joint mining investments at the Future Minerals Forum; and (5) government plans to establish a 6,000-acre Export Processing Zone on Pakistan Steel Mills land.
Sector-wise, Transport, Paper & Board, Oil & Gas Exploration Companies, Property, and Automobile Parts & Accessories were among the top performers, gaining 9.6%, 8.2%, 7.1%, 5.1% and 3.6% WoW, respectively. Conversely, Synthetic & Rayon, Jute, Miscellaneous, Textile Weaving, and Textile Spinning sectors underperformed, declining 10.2%, 8.9%, 4.5%, 4.1% and 4.1% WoW, respectively.
From a flow perspective, Individuals and Mutual Funds emerged as net buyers, with net purchases of $16.1 million and $12.8 million, respectively. In contrast, Banks and Insurance Companies were major sellers, posting net sales of $23.5 million and $15.8 million, respectively.
At the company level, top gainers during the week were ATLH (+22.3% WoW), AKBL (+12.8%), LOTHCEM (+12.4%), OGDC (+12.2%) and JVDC (+10.7%). On the downside, IBFL (-13.8%), SAZEW (-10.3%), AICL (-10.3%), PABC (-6.5%) and YOUW (-6.4%) were among the top laggards.
