Market Wrap: Banking on Bulls: KSE-100 Hits a New Milestone - By HMFS Research

Jul 4 2025

HMFS Research

• The Pakistan Stock Exchange (PSX) sustained its upward trajectory in today’s session, with the benchmark KSE-100 Index surging to a fresh intra-day high of 132,130 before closing at 131,949, up by a robust 1,262 points (+0.97%). The rally was supported by sustained investor interest—particularly in the banking sector—as participants continued to rotate into fundamentally sound, undervalued plays amid a supportive macroeconomic backdrop. Trading activity remained strong, with the All-Share Index posting a healthy turnover of 731mn shares, while KSE-100 volumes came in at 199mn shares, indicating broad-based participation. Top volume leaders included, WTL (58mn), BML (36mn), and TREET (30mn). The banking sector emerged as the primary driver of index gains, supported by attractive dividend yields, and compelling P/B valuations. The recent softening in Pakistan’s sovereign credit default swap (CDS) spreads has further improved investor sentiment by lowering perceived external risk, catalyzing flows into equities. While the momentum remains firmly intact, the market’s proximity to psychological resistance levels suggests room for near-term consolidation, especially as investors may opt to lock in recent gains. However, the medium-term narrative remains constructive, underpinned by prospects of continued IMF engagement, fiscal reforms, and easing external account pressures. We continue to advise investors to remain selective and focus on sectors with resilient fundamentals and earnings visibility. In the current phase of the cycle, valuation discipline, liquidity considerations, and macro-driven event positioning will remain critical in navigating market dynamics.

Market Wrap: Highlights of the day - JS Research

Jul 4 2025

JS Global Capital

• The KSE-100 Index closed the session on a strong note, gaining 1,262 points to settle at 131,949. Broad-based buying was seen across key sectors, with Autos, banks, and Power leading the charge. Investor sentiment remained upbeat, supported by improved macros and anticipation of further monetary easing. Looking forward, we have a favorable view on the market in the near term, backed by favorable liquidity conditions, positive policy cues, and foreign interest returning to key sectors. However, intermittent consolidation cannot be ruled out as the index approaches resistance levels.

Fertilizers: Sales to recover in June-2025; albeit inventory level remains high - By JS Research

Jul 4 2025

JS Global Capital

• As per provisional figures, Urea off-take during Jun-2025 is expected to clock in at 580k tons, arriving at a growth of 20% YoY/ 39% MoM. Cumulatively, Urea off-take is likely to post a negative growth of 23% YoY during 1HCY25. On the other hand, DAP off-take is likely to fall 15% YoY during the month.

• Company-wise, Fauji Fertilizer Company (FFC) is expected to post Urea off-take of 269k tons in Jun-2025, up 4% YoY. This includes 51k tons of granular Urea. Engro Fertilizers (EFERT) is likely to post growth 32% YoY, arriving at 205k tons. In terms of market share, EFERT Urea share improved by 3ppts YoY to 35%, while FFC’s share dipped 8ppts YoY during the month.

• Urea inventory is expected to remain elevated at around 1.3mn tons by the end of 1HCY25. Assuming capacity utilization remains stable at current levels, allowance of export can be a key trigger in our view, helping to mitigate inventory buildup despite the anticipated increase in local sales during 2HCY25.

Technical Outlook: KSE-100; Upside to continue - By JS Research

Jul 4 2025

JS Global Capital

• The KSE-100 Index witnessed a volatile session to close at 130,687, up 343 points DoD. Volumes stood at 900mn shares compared to 1,026mn shares traded in the last session. The index is expected to revisit yesterday’s high of 131,325 with a break above targeting 132,134, which can extend to 133,412. However, any downside will find support in the range of 129,050-129,870 levels. The RSI and the MACD are heading up, supporting a positive outlook. We advise investors to 'Buy on dips', keeping stoploss below 128,616. The support and resistance levels are placed at 129,867 and 131,415, respectively.

Morning News: SBP reserves hit nearly 40-month high on multilateral, commercial loans - By HMFS Research

Jul 4 2025

HMFS Research

• Pakistan’s central bank reserves hit around 40-month high this week, helped by multilateral and commercial loans that pushed the dollar stockpile to reach $14.51 billion as of June 30, 2025. The foreign exchange reserves held by the State Bank of Pakistan (SBP) increased by $3.66 billion or 40.41% WoW to $12.73 billion during the week ended on June 27, 2025. The reserves held by commercial banks rose by $30.9m or 0.58% WoW to $5.36bn. Similarly, the country's total reserves increased by $3.69bn or 25.66% WoW to $18.09bn.

• At the FfD4 conference in Spain, Finance Minister Muhammad Aurangzeb reaffirmed Pakistan’s commitment to international partnerships and economic reforms for sustainable development. He held key bilateral meetings with global counterparts, including officials from the Netherlands, World Bank, IFAD, and ICC, discussing cooperation in trade, climate resilience, institutional capacity, and rural development. Highlights included updates on Pakistan’s IMF program, the upcoming National Green Taxonomy, and the endorsement of the World Bank’s 10-year Country Partnership Framework, reflecting Pakistan’s active engagement in advancing its reform and resilience agenda.

• Banks across Pakistan have increased the fee for withdrawing cash from non-host ATMs—from Rs 23.44 to Rs 35 per transaction—effective from July 2025. Of this, Rs 28 goes to the ATM-owning bank to cover operational and maintenance costs, with Rs 7 retained by 1LINK, the interbank network. The move, justified by rising interbank transaction and equipment servicing costs, raises concerns for low-income and rural users, for whom frequent small withdrawals now carry a heavier burden amid inflation and economic strain.

Morning News: Forex reserves climb to $18bn as of June 27 - By Vector Research

Jul 4 2025

Vector Securities

• Pakistan’s foreign exchange reserves rose by $3.694 billion to $18.09 billion in the week ending June 27, the central bank said on Thursday, indicating a significant improvement in the country’s current account balance and the realisation of planned inflows. The forex reserves held by the State Bank of Pakistan (SBP) increased by $3.66 billion to $12.73 billion in the reporting week due to receipt of the multilateral and commercial loans, the SBP said in the statement.

• Finance Minister Muhammad Aurangzeb advanced strategic partnerships during a series of high-level bilateral meetings on the sidelines of the Fourth International Conference on Financing for Development (FFD4), held this week in Seville. Representing Pakistan at the UN-backed conference that ran from June 30 to July 3, Aurangzeb held discussions with counterparts and institutional leaders to bolster cooperation in trade, climate resilience, digital transformation and development finance.

• Pakistan has adopted an 'open handed policy' to award multibillion-dollar mining contracts, by providing equal opportunities to global competitors including the United States (US), China and Russia. China and Russia have long been arch-rivals of the US. At present, Pakistan is simultaneously engaging with all three countries.

Market Wrap: The benchmark index closed on a positive note - By IIS Research

Jul 3 2025

Ismail Iqbal Securities

• The benchmark index closed on a positive note, marking a new all time high both intraday and at the close. While the index showed strength, it remained somewhat volatile throughout the session, with instances of profit taking observed as investors locked in gains after the recent rally. Trading volumes decreased to 280mn shares today as compared to 346mn shares in the previous session. Today, the KSE-100 index gained 343 points to close at 130,687 level, up by 0.26% DoD. Oil & Gas Exploration Companies, Power Generation & Distribution, and Oil & Gas Marketing Companies sectors were the major contributors in today's session, cumulatively adding 392 points to the index.                                     

Market Wrap: Highlights of the day - By JS Research

Jul 3 2025

JS Global Capital

• The KSE-100 Index rose 342 points at day-end to close at 130,686, after hitting an intraday all-time high of 131,325. The bullish momentum, driven by strong institutional buying and optimism over earnings, particularly in the energy sector (OGDC, MARI, PPL), fueled early gains. Although profit-taking pared initial advances, the index stayed in the green. With positive macroeconomic indicators and sustained investor confidence, the market is expected to maintain its upward trajectory in the near term, though intermittent corrections remain likely.

Market Wrap:; Riding the Wave: PSX Holds Ground After Scaling New Heights - By HMFS Research

Jul 3 2025

HMFS Research

• The equity market extended its bullish momentum, with the KSE-100 Index continuing its record-breaking streak, reaching a new intraday high of 131,325—up by 981 points. However, the momentum tapered in the latter half of the session, with the index holding in the green but ultimately closing at 130,687—recording a modest gain of 343 points. Investor confidence remained elevated, underpinned by improving macroeconomic indicators and renewed optimism following the State Bank of Pakistan’s foreign reserves surpassing IMF benchmarks. The rally was primarily supported by strong performance in the banking and energy sectors, both of which contributed significantly to the index's gains. Trading activity remained robust, with 280mn shares traded on the KSE-100 Index and 897mn shares exchanged across the broader market. Volume leaders included WTL (49mn), IMAGE (37mn), and BOP (35mn). Looking ahead, while the bullish momentum is expected to continue, the sharp rally may trigger short-term profit-taking as investors capitalize on recent gains. Nonetheless, improving economic fundamentals are expected to provide a cushion for market stability. Investors are advised to stay vigilant and focus on fundamentally strong stocks with long-term growth potential.

Economy: Tariff rationalization to bring in competitiveness - By AKD Research

Jul 3 2025

AKD Securities

• Govt. has issued SROs pertaining to Additional Customs Duty (ACD) and Regulatory Duties (RDs), in line with National Tariff Policy 2025–30.

• ACD has been revised to 0%, 2%, 4%, and 6% (previously 2%, 4%, 6%, and 7%), while RD has been removed on multiple PCT codes, with the maximum RD rate reduced from 90% to 50%.

• Sector-wise, margins for auto assemblers are likely to normalize from recent highs, while chemical, steel, and textile spinning/weaving sectors would face margin pressures.