The Pakistan Stock Exchange (PSX) remained range bound during the outgoing week as geopolitical uncertainty and domestic developments kept investors cautious, with the benchmark KSE-100 index closing at 170,765, down 119 points, or 0.1%, week-on-week.

On a day-on-day basis, the bourse commenced the trading week with range-bound activity. The KSE-100 gained 269 points (+0.16%) to close at 171,153. Tuesday saw further consolidation amid falling oil prices. The index gained 250 points (+0.15%) at 171,402. The market further extended its advance on Wednesday, when it closed higher by 830 points (+0.48%) at 172,233.

However, geopolitical uncertainty dampened PSX sentiment on the second last day of the trading week, Thursday. The index declined 1,734 points (-1.01%) to close at 170,499. Friday was a range-bound day with the KSE-100 gaining 266 points (+0.16%) and settled at 170,765.

"Overall, geopolitical developments kept the market flat," observed Arif Habib Limited (AHL) in its commentary. The KSE-100 closed at 170,765 points, down 0.1% from 170,885 points in the previous week, as hopes of progress in US-Iran talks and softer oil prices supported the market early in the week before geopolitical concerns resurfaced and crude prices rose.

Power generation rose 5.1% year-on-year to 14,943 gigawatt hours (GWh) in Aug'26, the third-highest August generation on record, supported by higher hydel, coal, gas and wind output. Generation cost increased 38% YoY to Rs10.01/kWh due to higher RLNG and furnace oil mix and elevated oil prices, prompting power distribution companies to seek a positive fuel cost adjustment of Rs1.73/kWh, mentioned AHL.

Oil production improved 1.4% WoW to 68.5k barrels per day, mainly due to higher flows from Makori East, Maramzai and Mardankhel, while gas production decreased 2.5% WoW to 2,934 million cubic feet per day, driven by lower production from Mari, Uch, Kandhkot and Shewa.

Pakistan's oil and gas reserves reached 3,720 million barrels of oil equivalent in Jun'26, with oil reserves up 15% YoY to 276 million barrels and gas reserves up 9% to 20,664 billion cubic feet. Newly discovered fields added 53.5 million barrels of oil and 773 billion cubic feet of gas, while the country's estimated reserve life stood at around 19 years.

Pakistan's total liquid foreign exchange reserves rose 0.07% WoW to $26.8 billion, while the State Bank reserves increased 0.05% to $21.4 billion and banks' reserves grew 0.15% to $5.41 billion. Import cover remained unchanged at 3.03 months.

Attock Refinery, Pakistan Refinery, National Refinery and Cnergyico signed upgrade agreements with Inter State Gas Systems (ISGS) under the Pakistan Oil Refining Policy for Upgradation of Existing/Brownfield Refineries 2023, as amended in Feb'24 and Aug'26.

Petroleum prices were mixed in the latest revision under the daily pricing mechanism, with high-speed diesel falling to Rs412.12/litre during the week, while motor spirit reached Rs389.28/litre, added AHL.

Local and geopolitical uncertainty drove caution, noted Wadee Zaman of JS Global, stating that the KSE-100 remained broadly flat during the week, closing at 170,765 (-119 points), as geopolitical uncertainty and domestic political developments continued to weigh on investor sentiment.

Brent crude averaged $103.1/barrel, down 2.2% WoW, while domestic MS and HSD prices declined by Rs1.51/litre and Rs12.80/litre to Rs389.28/ltr and Rs412.12/ltr, respectively, following five consecutive weekly increases. On the external front, Pakistan and the IMF commenced talks for the fourth review of the $7 billion Extended Fund Facility, potentially paving the way for the release of the fifth tranche of $1 billion, mentioned Zaman.

Meanwhile, the ADB revised down Pakistan's FY27 GDP growth forecast to 3.7% from 4.5% previously. Pakistan secured $4.7 billion in foreign loans during 2MFY27, while profit and dividend repatriation declined 13.4% YoY to $557 million.

In a key development, four of Pakistan's five local refineries signed formal upgrade agreements with the government, paving the way for an estimated $6 billion investment over the next five years. In the latest Pakistan Investment Bond auction, the government raised Rs181 billion, with yields increasing by 20-75 basis points across different tenors. The State Bank's foreign exchange reserves remained stable at $21.4 billion, he said.