In front of monetary policy, the PSX range bound

In anticipation of the monetary policy statement later in the day, investors exercised caution on Monday, causing the Pakistan Stock Exchange (PSX) to stay range-bound and record modest gains of 82 points.

The central bank maintained its policy rate at 11%, as many observers had predicted in the wake of rising global tensions. The market took a signal from the recovery in global stocks and ended trading in positive territory despite the Israel-Iran confrontation.

The PSX began the morning on a positive note and hit its intra-day high of 122,903 points right away. Investors quickly turned to profit-taking, which caused the KSE-100 index to drop to its intra-day low of 121,890 after noon.

“Amid speculation about the State Bank of Pakistan’s (SBP) policy announcement later in the day, stocks advanced despite geopolitical risks,” stated Ahsan Mehanti of Arif Habib Corp. “Despite consolidation, trade stayed strong. The recovery of international stocks and the optimistic IMF-driven forecasts for privatization, economic expansion, and development spending in the FY26 government budget were the main drivers of the PSX’s bullish closing.

At 122,225.36 at the close of trade, the benchmark KSE-100 index saw a minor increase of 81.79 points, or 0.07%. In its study, Topline Securities noted that after the global markets recovered, Pakistan’s stock market had a backward session. Before ending at 122,225 with a little increase of 81 points, the benchmark index fluctuated between intra-day highs of 759 and 253 points.

According to Topline, Bank AL Habib, OGDC, NBP, Mari Petroleum, and Meezan Bank all contributed positively to the index, adding a total of 371 points. However, 255 points were lost due to stock sales in Engro Holdings, Pakgen Power, and Lucky Cement.

The overall traded volumes reached 1.22 billion shares, and the traded value reached Rs26 billion, indicating strong market activity, it continued.

Deputy Head of Trading Ali Najib of Arif Habib Limited described it as “a consolidation day ahead of the MPS (Monetary Policy Statement).”

According to him, the PSX had a range-bound session and finished up 82 points at 122,225, on a rather flat note. As the street had predicted, the State Bank kept its benchmark rate at 11%.

During the day, the benchmark index floated between 121,890 and 122,903 levels, making them the intra-day low and high, respectively. Investors opted for a cautious approach amid heightening geopolitical tensions in the backdrop of Iran-Israel conflict, Najib said.

Among corporate news, the Fauji Fertiliser Company (FFC, -0.26%) board approved the submission of an Expression of Interest for PIA Holding Company (+7.95%) as the government planned to sell a 51-100% stake in PIA by the deadline of June 19.

“Developments in the Middle East determine the market’s course, and 120,000 provides crucial support. With improved stability, the index could target 130,000 in the near term,” he anticipated. JS Research analyst Mubashir Anis Naviwala said that the bourse opened on a positive note, touching the intra-day high of 122,903, but failed to sustain the momentum. It closed at 122,225 as profit-taking emerged later in the session. On the economic front, the State Bank kept the policy rate unchanged at 11%, aligning with expectations. Trading activity was dominated by small-cap stocks, reflecting short-term speculative interest, he said.

“We advise investors to maintain a cautious stance and avoid aggressive exposure for now. Risk management remains the key amid geopolitical uncertainty and macro developments,” Naviwala added.

Overall trading volumes stood at 1.22 billion shares compared with Friday’s tally of 968.3 million. The value of shares traded was Rs25.7 billion. Shares of 471 companies were traded, of which 282 stocks closed higher, 159 dropped and 30 remained unchanged.

Among volume leaders, WorldCall Telecom saw trading in 267.1 million shares, gaining 17 paisa to Rs1.62 per share. It was followed by Pervez Ahmed Consultancy with trading in 92.03 million shares, gaining one rupee to Rs3.93 and First Capital Securities with 86.02 million shares, higher by 79 paisa to Rs3.85. Foreign investors bought shares worth Rs243.5 million, the National Clearing Company reported.