Category: Business

The Pakistan Stock Exchange has recomposed the benchmark KSE-100 Index for the review period March to August 2026, with four companies entering and four leaving the index effective October 1, 2026.

The incoming companies are Image Pakistan Limited, Thatta Cement Company Limited, Nishat Chunian Power Limited and Bank Makramah Limited, which replace Hum Network Limited, Mehmood Textile Mills Limited, Pakistan Aluminium Beverage Cans Limited and Rafhan Maize Products Company Limited.

According to the exchange’s announcement, three of the four exits were driven by the market-capitalisation-based rule, while Hum Network’s removal followed the sector-based rule under the index methodology.

Index reconstitutions matter for investors because mutual funds, ETFs and other index-tracking products adjust their holdings to mirror the changes, often generating heightened trading activity in the affected stocks around the effective date.

The Pakistan Stock Exchange ended Thursday’s session sharply lower, with the benchmark KSE-100 Index closing at 168,636.85 — down 1,332.47 points, or 0.78 percent — as geopolitical tensions in the Middle East kept investors on edge.

The index swung within a 2,120-point range during the session, touching an intraday high of 170,688.38 before sliding to a low of 168,567.78. Of the 100 index constituents, 86 closed lower, 13 advanced and one remained unchanged, on volume of 149.85 million shares.

Commercial banks, oil and gas exploration companies and cement stocks bore the brunt of the selling. Pakistan Petroleum dragged the index by 131.47 points, followed by UBL at 106.06 points, Hub Power at 84.68 points, OGDC at 76.24 points and Fauji Fertilizer at 71.69 points.

In the broader market, the KSE All-Share Index closed at 102,097.08, down 795.55 points or 0.77 percent. Total market volume stood at 548.38 million shares against traded value of Rs17.05 billion, with 323 companies declining and 121 advancing.

Market watchers linked the decline to renewed US-Iran tensions and the resulting rise in international crude prices, which have clouded the outlook for inflation and Pakistan’s external account given the impasse over the Strait of Hormuz shipping route.

Sentiment remained cautious into Friday’s session, with analysts noting investors were also tracking incoming US employment data and the domestic monetary policy outlook amid elevated fuel prices.

Pakistan has opened a new round of talks with the International Monetary Fund, with the Fund’s mission in Islamabad for the fourth review of the $7 billion Extended Fund Facility and the third review of the Resilience and Sustainability Facility.

Finance Minister Muhammad Aurangzeb held the kick-off meeting with the mission, led by IMF Mission Chief for Pakistan Iva Petrova, on September 29 in Islamabad, marking the start of detailed discussions on economic performance and outstanding reform commitments.

The review will assess Pakistan’s performance through June 2026 against programme commitments, covering fiscal targets, tax reforms, monetary policy, energy-sector measures and structural benchmarks. The mission has already held discussions with the State Bank in Karachi and is expected to remain in the country until the first week of October.

Successful completion of the reviews, followed by approval from the IMF Executive Board, could unlock about $1 billion under the EFF and another $200 million under the RSF — roughly $1.2 billion in new disbursements, potentially by end-November or early December.

In the Islamabad phase, the mission is meeting the Finance Ministry, the Federal Board of Revenue and other institutions. Discussions are also covering a heavy legislative agenda, with the Finance Secretary having told a parliamentary committee that the IMF had sought around 174 amendments to various laws covering taxation, energy, privatisation, state-owned enterprises and climate-related reforms.

The State Bank of Pakistan’s latest economic snapshot shows the policy rate unchanged at 11.5 percent, liquid foreign exchange reserves of $26.77 billion, and the rupee holding broadly steady near 277 to the US dollar.

As of September 25, total liquid foreign exchange reserves stood at $26,770.9 million. Of this, the State Bank held $21,439.2 million while commercial banks held $5,331.7 million, according to the central bank’s data.

In the interbank market, the SBP’s indicative rate for the dollar stood at Rs277.10 (M2M revaluation rate) on October 1, with a weighted average bid of Rs276.83 and offer of Rs277.25.

Separately, the State Bank raised the remuneration rate on the Special Cash Reserve Account (US$) to 2.91 percent for October 2026, up from 2.71 percent in September and 2.66 percent in August. The rate, tied to international benchmarks, applies to foreign currency deposits banks are required to hold with the central bank.

In money markets, the September 30 treasury bill auction saw cut-off yields of 11.68 percent for one month, 11.99 percent for three months, 12.45 percent for six months and 12.49 percent for twelve months — levels broadly consistent with the current 11.5 percent policy rate.