KARACHI: The Pakistan Stock Exchange (PSX) extended its losing streak to a sixth straight session on Friday, despite the successful launch of Pakistan’s first Panda Bonds in the Chinese market, as rising oil prices and persistent geopolitical tensions kept investors on edge.
Surging crude prices, coupled with mounting inflationary concerns, prompted continued selling at the PSX. Oil prices rose more than 3pc, climbing over $3 per barrel after remarks by US President Donald Trump and Iran’s foreign minister dampened hopes of a deal to halt attacks and seizures involving shipping in the Strait of Hormuz.
According to Topline Securities Ltd, the benchmark KSE-100 index traded between an intraday high of 166,924.48 points, up 425 points, and a low of 165,291.53 points, down 1,207 points. The index eventually settled at 165,596.07 points, losing 902.77 points, or 0.54pc.
The main drag on the index came from Bank Al-Habib, Engro Holdings, Fauji Fertiliser, Lucky Cement, United Bank, Oil and Gas Development Company, and Meezan Bank, which collectively eroded 1,143 points from the benchmark.
Inflation concerns and geopolitical tensions weigh on investor sentiment
Investor participation remained subdued, with trading volume declining 11.41pc to 625.45 million shares. However, traded value increased by 11.98pc to Rs22 billion.
In a research note, the brokerage house projected inflation, measured by the Consumer Price Index (CPI), at 11-11.5pc year-on-year in May, compared to 10.89pc in April and 3.46pc in May 2025. If realised, this would mark the highest monthly inflation reading in 23 months.
Arif Habib Ltd (AHL) said the International Monetary Fund expected Pakistan’s underlying primary surplus to remain in line with the fiscal-year target ending in June.
Meanwhile, Pakistan raised RMB1.75bn ($250m) through a three-year fixed-rate Panda Bond carrying a 2.5pc coupon in China’s onshore capital market. The Ministry of Finance said it planned to proceed with the next tranche immediately.
AHL noted that the benchmark index had been moving sideways over the past four weeks, indicating a consolidation phase. However, it maintained expectations of an upward move, with a near-term target of 175,000 points.
Published in Dawn, May 16th, 2026
