Key Takeaways
- • The Pakistan Stock Exchange benchmark index fell 4,045 points, or 2.4% week-on-week, to close at 162,375 on Friday, October 23, 2026, with average daily trading volume down 13.4% to 496 million shares.
- • Brent crude futures rose 6.4% week-on-week to US$114.9 per barrel amid continued Houthi attacks on Saudi Arabia and reports of possible US action against Iran after midterm elections.
- • Mutual funds (US$10.2 million) and foreign investors (US$5.7 million) were net sellers, while individuals were the major net buyers at US$14.0 million.
- • AKD Securities expects a market recovery driven by improving economic indicators and the upcoming MPC meeting, which it expects to result in the central bank holding rates steady.
- • FY26 GDP growth was revised slightly down to 3.65% from a 3.7% provisional estimate, compared with 3.1% in FY25; the World Bank projects 3.8% growth for FY27.
Summary
The Pakistan Stock Exchange experienced volatility during the week ending October 23, 2026. The benchmark index declined by 4,045 points, or 2.4% week-on-week, to close at 162,375. Average daily trading volume fell 13.4% week-on-week to 496 million shares. The decline came amid continued Houthi attacks on Saudi Arabia and reports of a possible US attack on Iran after midterm elections.
Brent crude futures climbed 6.4% week-on-week to US$114.9 per barrel as of Friday. Local high-speed diesel and petrol prices declined, attributed by authorities to a reduction in the refinery crack cap and relatively stable Dubai crude prices.
On the macroeconomic front, FY26 GDP growth was revised slightly down to 3.65% from the provisional 3.7%, compared with 3.1% in FY25. The World Bank projects FY27 GDP growth at 3.8% and inflation at 8.2%, up from 7.1% in FY26. State Bank of Pakistan foreign exchange reserves rose to US$21.49 billion as of October 16, 2026. Banking sector deposits grew 16% year-on-year to PKR40.8 trillion at end-September 2026. Consumer auto financing rose 33.6% year-on-year to PKR407 billion in September, marking the 22nd consecutive month of growth. Power generation grew 6% year-on-year in 1QFY27.
Other notable developments during the week included the Finance Minister seeking Fitch's view on the steps needed for Pakistan to move into the BB rating category, Prime Minister approval of a five-year draft Auto Policy, and the Privatization Commission pre-qualifying 10 bidders for IESCO. Power sector circular debt rose to PKR1.7 trillion, while gas sector liabilities increased to PKR3.6 trillion as of June 30, 2026.
Modarabas, Sugar & Allied Industries and Leasing Companies were the top-performing sectors, while Refinery, Technology and Communication, and Woolen were the laggards. AKD Securities expects the market to improve on strengthening economic indicators and expects the central bank to maintain the status quo at its upcoming MPC meeting. The brokerage views any positive development in the Middle East conflict as a potential trigger, since it could moderate oil prices and pave the way for monetary easing. AKD Securities also considers the market to trade at attractive valuations.
Brent crude futures climbed 6.4% week-on-week to US$114.9 per barrel as of Friday. Local high-speed diesel and petrol prices declined, attributed by authorities to a reduction in the refinery crack cap and relatively stable Dubai crude prices.
On the macroeconomic front, FY26 GDP growth was revised slightly down to 3.65% from the provisional 3.7%, compared with 3.1% in FY25. The World Bank projects FY27 GDP growth at 3.8% and inflation at 8.2%, up from 7.1% in FY26. State Bank of Pakistan foreign exchange reserves rose to US$21.49 billion as of October 16, 2026. Banking sector deposits grew 16% year-on-year to PKR40.8 trillion at end-September 2026. Consumer auto financing rose 33.6% year-on-year to PKR407 billion in September, marking the 22nd consecutive month of growth. Power generation grew 6% year-on-year in 1QFY27.
Other notable developments during the week included the Finance Minister seeking Fitch's view on the steps needed for Pakistan to move into the BB rating category, Prime Minister approval of a five-year draft Auto Policy, and the Privatization Commission pre-qualifying 10 bidders for IESCO. Power sector circular debt rose to PKR1.7 trillion, while gas sector liabilities increased to PKR3.6 trillion as of June 30, 2026.
Modarabas, Sugar & Allied Industries and Leasing Companies were the top-performing sectors, while Refinery, Technology and Communication, and Woolen were the laggards. AKD Securities expects the market to improve on strengthening economic indicators and expects the central bank to maintain the status quo at its upcoming MPC meeting. The brokerage views any positive development in the Middle East conflict as a potential trigger, since it could moderate oil prices and pave the way for monetary easing. AKD Securities also considers the market to trade at attractive valuations.
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