Pakistan’s KSE-100 index loses 3,560 points in October — Dawn
The key KSE-100 index of the Pakistan Stock Exchange (PSX) in Karachi fell by 3,560 points, or 2.1%, to 166,409 points by the end of October. As Dawn reports, investor sentiment was affected by tensions in the Middle East and domestic political uncertainty in Pakistan following the introduction of a state of emergency and governor’s rule in Khyber Pakhtunkhwa province.
Reasons for the decline
Topline Securities attributed the monthly decline in the index to geopolitical uncertainty, foreign portfolio capital outflows, profit-taking in shares of major companies, and investor caution amid fluctuations in global financial markets and domestic macroeconomic risks.
At the end of the month, the market partially recovered its losses amid diplomatic efforts to settle the conflict between the United States and Iran, as well as better-than-expected corporate reporting. According to AKD Securities, during the final week of October, the KSE-100 rose by 4,034 points, or 2.5%, while the average daily trading volume surged by 121% to 1.095 billion shares.
Interest rate and oil prices
On October 26, the State Bank of Pakistan raised its policy rate by 50 basis points to 12%. The regulator explained the decision by rising energy prices and geopolitical uncertainty affecting the inflation outlook. This was the first rate increase since April.
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In September, inflation slowed to 10.26% from 11.15% in August, but remained significantly higher than the 5.76% recorded in September 2025. At the same time, Pakistan’s current account deficit increased to $356 million in September from $73 million a month earlier.
Trading and corporate profits
The average daily share trading volume in October amounted to 600 million, up 27% from September. The value of trading increased by 19% to 23 billion Pakistani rupees. Profits of companies accounting for 96% of the KSE-100 index’s weight rose by 26% year on year in the first nine months of 2026, to 1.638 trillion rupees.
Oil prices remained high due to supply concerns following Houthi attacks on Saudi Arabia and tanker incidents near the Strait of Hormuz. Brent rose by 0.7% over the week to $117.10 per barrel as of Friday. Analysts expect sentiment in the Pakistani market to continue depending on developments in relations between the United States and Iran, as well as international oil prices.
