The outlook for Pakistan’s stock market remains positive as investors focus on the upcoming monetary policy meeting scheduled for March 10 and any developments on the International Monetary Fund (IMF) review.
An analyst at AKD Securities stated that the KSE-100 index is anticipated to sustain its upward trajectory over the medium term, with a target of 165,215 points by December 2025.
This growth is expected to be driven by strong earnings in the fertilizer sector, sustained returns on equity (ROEs) in banks, and improving cash flows of exploration and production (E&P) companies and oil marketing companies (OMCs), benefiting from falling interest rates and economic stability.
Arif Habib, an analyst, commented that the upcoming IMF mission and the first review of the bailout program are expected to reinforce investor confidence. Inflation for February 2025 is projected to clock in at 2.2%, marking its lowest level since October 2015.
This decline in inflation is likely to further strengthen investor optimism. Additionally, with the ongoing result season, certain stocks are anticipated to be in the limelight amid expectations of robust results.
The KSE-100 index closed in the green zone for the week ended February 28, supported by improved liquidity on the local front and positive investor sentiment surrounding discussions on the additional $1 billion climate funding under the IMF’s $7 billion Extended Fund Facility (EFF).
Foreign selling continued during this week, clocking in at $6.0 million compared to a net sell of $5.1 million last week.
February Performance
For the month ended February 28, the KSE-100 index declined by 0.88% on a month-on-month basis.
Major events during the outgoing month included:
The Consumer Price Index (CPI) for January 2025 clocked in at 2.41%, compared to a CPI of 4.1% in December 2024.
Remittances for January 2025 amounted to $3.0 billion, reflecting a 25% year-on-year increase and a 2% month-on-month decrease.
Pakistan car sales, as reported by PAMA, reached 17,010 units in January 2025, marking a 61% year-on-year increase and a 73% month-on-month increase.
The Pakistan current account for January 2025 posted a deficit of $420 million, compared to a surplus of $474 million in December 2024.
Foreign Direct Investment (FDI) for January 2025 clocked in at $194 million, representing a 14% month-on-month increase.
