Foreign selling, weak earnings drag PSX lower in first Ramadan session

The bourse fell on Thursday as continuous foreign selling and weak corporate results kept sentiment fragile, while thinner participation on the first day of Ramadan saw slower trade after the previous session’s sharp rebound.

The Pakistan Stock Exchange's benchmark KSE-100 Index traded between a high of 179,279.74 (up 426.65 points, or 0.24%) and a low of 171,650.05 (down 7,203.04 points, or -4.03%) against the previous close of 178,853.09.

Mohammed Sohail, CEO of Topline Securities, cited "continuous foreign selling and weak corporate results" as causes for the bearish trend.

"Today the volumes are lacklustre due to the 1st Ramadan day and generally lower activity. The sharp rise yesterday is seeing some profit taking today and likely to continue depending on the quality of results," said AAH Soomro, an independent investment and economic analyst.

"Current Account data has paused the correction phase," he added.

Foreign direct investment (FDI) in 7MFY26 (July–January) fell 41% year-on-year to $981.4 million, central bank data showed. Net FDI stood at $173 million in January, reversing a $135 million net outflow in the previous month, while cross-border investments were down 25.5% from a year earlier. 

China remained the largest investor, though net Chinese investment declined to $495.5 million from $857.1 million a year earlier. 

Sector-wise, power inflows fell to $541.8 million from $890.3 million, while telecoms posted outflows of $442.7 million, as compared to $79.6 million outflows last year. Financial businesses attracted $460 million, up from $432.4 million.

In Wednesday’s market Treasury bills auction, the government raised Rs651 billion (realised value), with yields mixed, according to the State Bank of Pakistan (SBP). 

The one-month cut-off eased 5 bps to 10.1482%, while the three-month rose 9 bps to 10.2853%, the six-month increased 12 bps to 10.4437%, and the 12-month climbed 20 bps to 10.5996%. 

The government raised Rs677 billion (face value) against a Rs450 billion target and Rs448 billion maturities, with participation of Rs1.265 trillion.

Inflation, meanwhile, edged up to 5.8% in January from 5.6% a month earlier, while the SBP last month kept its benchmark policy rate unchanged at 10.5%.

The KSE-100 surged 5,702.68 points (3.29%) to 178,853.10 from 173,150.42, trading between 178,974.17 and 174,328.61 in the previous session on Wednesday.