The outcome of the US-Iran peace talks will set the direction of the Pakistan Stock Market Exchange in the coming week, as positive developments can help equities regain lost ground.
An analyst from Arif Habib Ltd. said that the KSE-100 Index outlook remains closely tied to evolving developments in the US-Iran talks, which are likely to take place over the weekend in Pakistan’s capital, Islamabad.
The market sentiment is sensitive to any progress in negotiations, he added.
Additionally, the ongoing March-quarter earnings season and the upcoming monetary policy decision are expected to play a pivotal role in shaping near-term market direction, he said.
An analyst from BMA Capital Management said that Investors are likely to focus on Monday’s monetary policy meeting, with expectations split between a status quo and a modest rate hike.
This divergence reflected mixed signals around the timeline of ceasefire negotiations and the duration of ongoing supply chain disruptions.
Talks with the IMF will also reveal the structure of the upcoming federal budget. Focus is likely to be on strengthening Pakistan’s fiscal and external positions through targeted tax and trade reforms, he said.
The KSE-100 Index lost momentum during the week, declining by 2% or 3,267 points to close at 170,672.
The KSE-100 Index remained subdued during the outgoing week amid the delays in the second round of US–Iran negotiations despite a ceasefire extension by the US at Pakistan’s request.
Heightened geopolitical uncertainty, coupled with rising oil prices following tensions and disruptions around the Strait of Hormuz, weighed on global equities and dampened investor sentiment.
International oil prices crossed the $100 per barrel mark, hovering around $105/bbl at the close of the week.
As oil prices rebounded by over 20% from the previous week’s low, investors grew increasingly concerned about the implications for Pakistan’s inflation outlook and external account position, particularly ahead of the upcoming monetary policy meeting, scheduled for April 27.
Meanwhile, discussions between the govt and the IMF are ongoing, with reports indicating that 11 additional conditions will be introduced under the program.
Weekly review
The sectors that contributed negatively to the index were cement(864 points), fertilizer (707 points), banks (337 points), and E&Ps (310 points).
Meanwhile, sector-wise positive contributions came from refinery (160 points), OMCs (64 points), and property (22 points).
Scrip-wise, negative contributions came from Fauji Fertilizer Company (401 points), Habib Bank (297 points), Lucky Cement (291 points), and Engro Fertilizers Limited (270 points).
Average traded volume was 1,206 million shares, up 16.2% for the week, while average value traded was $163.5 million, down 5.7%.
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