12 September 2026PSX Analyst

The 44% year that felt like a bad one

The KSE-100 rose roughly 44% in rupee terms in FY26. That was the third consecutive year in which it beat every other major asset class available to a Pakistani saver.

Ask anyone who traded it whether it felt like that.

The index touched 189,167 on 23 January. Seven weeks later, on 9 March, it printed 146,480. That is a 29% swing inside a single financial year, and the gap between those two numbers is the whole story of 2026 so far.

A return and an experience are different things

An annual return is measured between two dates chosen by the calendar. Nobody actually buys on 1 July and sells on 30 June. Real people bought somewhere in the middle, watched a quarter of the value come off, and made a decision about it.

The ones who held got the 44%. The ones who sold in early March got something much worse, and they sold for reasons that looked entirely sound on the day.

This is why a headline annual figure is close to useless as a description of risk. It compresses out the only part that determines whether a person stays invested.

What kept knocking it over

The second half of the year turned on one recurring external shock. Every attempted rally ran into the same wall: the Iran conflict, a jump in crude, and renewed anxiety about Pakistan's external account.

The moves were not small. The index shed more than 2,500 points in a single session on Middle East escalation, and on another slid 2,541. By mid-September it was trading somewhere in the high 160,000s to near 170,000, still a long way below that January high.

If you want one sentence for the year, it is this: the domestic case kept working and something outside the country kept interrupting it.

The number that should bother you

Net foreign selling ran to around $900 million during the rally.

Read that again, because it is genuinely strange. Foreign institutions sold nearly a billion dollars into one of the best-performing equity markets in Asia.

That is not a group of people who think the market is going up. It suggests international allocators were using the strength as an exit rather than an entry, which is what tends to happen when a market rallies on local liquidity while the external story stays unresolved.

The move was real. The conviction behind it, from the people with the largest cheques, was not.

What the forecasters say, and why the spread matters

Brokerage targets for December sit around 203,000 at Topline and about 263,800 at AKD Research.

That is a gap of roughly 60,000 points between two serious houses looking at the same market. The spread is more informative than either number. When professionals this well informed land 30% apart, what they are really telling you is that the outcome hinges on something none of them can forecast, which in this case is the Strait of Hormuz.

Treat both figures as scenarios with an assumption attached, not as predictions. The honest version of either is "if the conflict resolves" or "if it does not".

The takeaway

Pakistani equities did their job in FY26 and delivered a return well ahead of the alternatives. They did it in a way that would have shaken most investors out somewhere around 9 March.

Both of those things are true, and only one of them fits in a headline.

Sources

This is NOT financial advice. Consult a licensed advisor and comply with SECP/PSX regulations.