The equity market started the week on a high note, with the Pakistan Stock Exchange (PSX) reaching a new record territory on Monday. This sustained buying interest was driven by robust corporate results and growing optimism regarding the resolution of circular debt. The benchmark KSE-100 Index closed at an all-time high of 146,929.84 points, marking a gain of 1,547.05 points, or 1.06%.
During the session, the index briefly touched an intraday high of 147,005.17 points, before settling lower. Ahfaz Mustafa, CEO of Ismail Iqbal Securities, attributed the rally to “stellar corporate results, improving sentiment and liquidity.” He added that the market would continue to react to company earnings and news about circular debt payments.
Macroeconomic indicators for the month showed a mixed trend. The trade deficit for July 2025 widened by 44% year-on-year (YoY) to $2.8 billion due to higher imports. However, remittances increased by 7% YoY to $3.2 billion, despite a 6.0% month-on-month (MoM) decline. The State Bank of Pakistan’s (SBP) foreign exchange reserves slightly dropped by $72 million week-on-week (WoW) to $14.2 billion, mainly due to external debt repayments. The rupee showed modest appreciation of 0.1% WoW, closing at Rs282.47 against the US dollar.
On the policy front, the government announced significant reforms in the power sector, reducing circular debt by Rs780 billion to Rs1.6 trillion. A five-year privatization roadmap for 24 companies was also unveiled, with 10, including Pakistan International Airlines, slated for sale in the first phase.
In other positive news, textile exports surged by 33.7% YoY in July 2025 to $1.69 billion. In the T-bill auction, the SBP raised Rs386 billion against a target of Rs400 billion, with yields increasing by 5-30 basis points across all maturities.
This strong performance follows a notable rally last week, where the KSE-100 closed at 145,383 points, gaining 4,348 points or 3.08% WoW, after hitting a record high on Thursday before a minor pullback on Friday.
