PSX benchmark index declines 2.4%WoW
Pakistan Stock Exchange (PSX) experienced volatility during the outgoing week amid continued Houthi attacks on Saudi Arabia, with news of the US planning an attack on Iran after midterm elections.
The benchmark Index declined by 4,045 points or 2.4%WoW to close at 162,375 on Friday, October 23, 2026. Average daily trading volume declined by 13.4%WoW to 496 million shares.
Brent crude futures climbed by 6.4%WoW to US$114.9/ bbl as of Friday. Meanwhile, local HSD and Petrol prices declined attributed to a decline in refinery crack cap by authorities and relatively stable Dubai crude oil prices.
On the macroeconomic front, FY26 GDP growth revised slightly down to 3.65% from provisional estimates of 3.7% as compared to 3.1% in FY25.
The World Bank projected FY27 GDP growth at 3.8% and inflation at 8.2% (7.1% in FY26).
Foreign exchange reserves held by State Bank of Pakistan (SBP) increased to US$21.49 billion as of October 16, 2026.
Banking sector deposits rose 16%YoY to PKR40.8 trillion at end September 2026.
Consumer auto financing increased 33.6%YoY to PKR407 billion in September 2026 (up for the 22nd consecutive month).
Urea offtakes rose 42%YoY to 611,000 tons in September 2026 amid channel inventory build-up ahead of the Rabi season, whereas DAP offtakes declined 30%YoY to 68,000 tons amid higher local prices.
Power generation grew 6%YoY in 1QFY27 amid recovery in electricity consumption.
Cotton arrivals increased 8%YoY to 4.1 million bales as of October 15, 2026.
Other major news flow during the week included: 1) Finance Minister sought Fitch’s view on what Pakistan needs to move into the BB rating category, 2) Prime Minister approved the draft of Auto Policy for five years, 3) Weekly SPI rose 0.65%WoW and 11.85%YoY, 4) Privatization Commission pre-qualified 10 bidders for IESCO, and 5) Power sector circular debt rose to PKR1.7 trillion, while gas sector liabilities increased to PKR3.6 trillion as of Jun 30, 2026.
Top performing sectors were: Modarabas, Sugar & Allied Industries, and Leasing Companies, while laggards included: Refinery, Technology and Communication, and Woolen.
Major net selling was recorded by Mutual Funds (US$10.2 million) and foreigners (US$5.7 million), while major buyers were Individuals (US$14.0 million.
Top performing scrips were: THCCL, UPFL, PSEL, TPLRF1, and BWCL, while laggards included: PTC, PGLC, AHCL, ATRL, and KAPCO.
AKD Securities expects the market to improve on the back of strengthening economic indicators.
The brokerage house expected upcoming MPC meeting as a major catalyst and predicts the central bank to maintain the status quo.
Any positive development on Middle East conflict could moderate international oil prices and serve as a key trigger for market as it paves the way for monetary easing.
The market continues to trade at attractive valuations.
Top picks of the brokerage house include: OGDC, PPL, UBL, MEBL, HBL, FFC, ENGROH, PSO, LUCK, FCCL, INDU, ILP and SYS.
According to an AKD Securities report, Urea offtakes surged 42%YoY in September 2026 to 611,000 tons, due to: 1) buildup of channel inventory ahead of Rabi season, 2) availability of subsidy and incentives from both Punjab and Sindh governments, 3) dealer financing provided by companies, 4) lower sales in prior quarter due to ban in KPK & Baluchistan along with disruptions by strike, 5) anticipations of increased sowing activity on higher wheat prices, and 6) higher available inventory. Cumulative offtakes in Kharif season rose 8%YoY to 3.4 million tons. This eased urea inventory to 643,000 tons as of end of the month from the recent peak of 971,000 tons in May 2026. On the contrary, DAP offtakes declined by 30%YoY during the month under review to 68,000 tons and down 25%YoY during Kharif season. The said decline in DAP was largely due to surge in local prices post Mideast conflict to an all-time high, peaking at PKR17,000/ bag, with average prices up 23%YoY during the Kharif season. Among other nutrients, CAN sales rose by 43%YoY, while NP sales declined by 3%YoY during the month.
EFERT’s urea sales surged to 218,000 tons, mainly due to higher available inventory. Consequently, EFERT’s market share recovered to 35% from 24% during the same period last year. Subsequently, company’s inventory eased to 518,000 tons (81% of industry) from 553,000 tons at end August 2026, with EnVen turnaround also contributing to the decline. In contrast, company’s DAP offtakes rose by 5x YoY, due to low base, resulting in market share improvement to 22% from 3%.
FFC’s urea sales were recorded at 261,000 tons, up 10%YoY, however, lower than industry’s 42%YoY increase, normalizing its market share to 43% from 55%. Meanwhile, FFC’s DAP sales declined by 44%YoY to 34,000 tons, mainly on higher prices. Consequently, company’s market share fell to 51% in September 26 from 63% in SPLY. Notably, FFC held 180,000 tons of DAP inventory as at end of the month (69% of industry).
FATIMA’s urea sales rose to 102,000 tons due to low base. Consequently, its market share increased to 17% from 12% in SPLY, while its urea inventory eased to 2.5-years low of 28,000 tons. Additionally, CAN offtakes also have witnessed 43%YoY increase to 63,000 tons, while NP sales declined 17%YoY to 26,000 tons.
The brokerage house expects the momentum in urea sales to continue going forward, with CY26 projected to close at above 6.7 million tons of urea offtakes, driven by sustained demand and supportive budgetary measures. It maintains an overweight stance on the fertilizer sector, supported by robust earnings, and strong cash flows translating into attractive dividend yields.