Monthly Digest – October 2023 In Review


In October, Pakistan’s stock market showed impressive gains, with the KSE-100 index closing at 51,920 points. This was the highest level in six years. Several factors contributed to this positive trend:

  1. Strong Corporate Earnings: Many companies reported robust earnings and distributed healthy payouts, exceeding market expectations.
  2. Gas Price Hike: The approval of a long-awaited gas price increase was a significant development.
  3. IMF Review: Anticipation of a positive outcome in the upcoming IMF review, which could unlock USD 710 million, also boosted market confidence.
  4. Inflation Expectations: It was expected that the inflation rate (CPI) would start to decrease, which further encouraged investors.

The central bank maintained the policy rate at 22%, but the drop in government securities’ yields, along with expectations of declining inflation, led to hopes of a potential reduction in interest rates in the near future. They predicted a decreasing trend in inflation throughout the second half of the fiscal year but noted that oil price fluctuations and a gas tariff increase could impact inflation in FY24. To stay updated on more news like this, follow us on Facebook.

Looking ahead, it is expected that the inflation rate (CPI) will decrease in the coming months, and interest rates might start to decline from the first quarter of the next calendar year.

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Top Performers

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The top-performing sectors during the month were Banks, Fertilizers, and Power, contributing significantly to the index’s growth. If you’d like to invest in the best stocks available on PSX, download the KTrade app!

Future Prospects

Potential political conflicts in the Middle East and global oil price fluctuations remained concerns. The World Bank issued a warning about the impact of a conflict in the Middle East on oil prices.

Recommended Sectors

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These include the Oil and Gas sector, benefiting from the gas price hike, and cyclical sectors like Cement and Steel, expected to perform well as market sentiment improved.

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In conclusion, it was anticipated that Pakistan would successfully conclude the upcoming IMF review, resulting in the release of USD 710 million, which would boost the country’s foreign reserves and improve the import cover.

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