The KSE-100 closed at 168,636.85 on Thursday 1 October 2026, down 1,332.47 points (−0.78%). That puts the benchmark right on the 168,000 area, the most important support on the chart. October starts with the market asking one question: does 168k hold?
This page covers what happened today, why the market is under pressure, the levels that matter, three scenarios for the rest of the year and the dates to keep in your diary. For live index levels, see the market page.
What happened on 1 October
The day started well. The index opened near 170,000 and touched an intraday high of 170,688.38. Selling then built through the session. Two attempts to recover, around midday and in the final hour, both faded, and the index slipped close to the day's low of 168,567.78 before settling at 168,636.85 (Business Recorder).
The fall was broad. Of the 100 index members, only 13 closed higher and 86 closed lower, according to our end-of-day data. About 548 million shares worth roughly Rs 17.1 billion changed hands on the regular market.
| Index | Close (1 Oct) | Change |
|---|---|---|
| KSE-100 | 168,636.85 | −1,332.47 (−0.78%) |
| KSE-30 | 50,262.67 | −0.75% |
| KMI-30 (Shariah) | 241,515.75 | −0.86% |
| All Share | 102,097.08 | −0.77% |
| Banks (BKTI) | 46,890.47 | −0.52% |
| Oil and gas (OGTI) | 34,227.31 | −1.41% |
| Dividend 20 (PSXDIV20) | 77,486.22 | −0.60% |
Oil and gas stocks were the weakest group. PPL fell 2.4% and OGDC 1.1%. Cement names also lost ground, with DGKC down 2.7% and MLCF down 2.1%. Banks held up better than the market, and ABL and ATRL were among the few large names to close slightly higher.
The five things driving the market
1. Oil and the war involving Iran
The US-Israel war on Iran has kept the Strait of Hormuz disrupted. Brent crude rose about 13% in September and traded around $97 to $103 a barrel at the end of the month (Trading Economics). There are some signs of relief: Saudi loadings at Yanbu have resumed, and the US and Iran are exchanging proposals on reopening Hormuz.
For Pakistan, an oil importer, high oil means a bigger import bill, more pressure on the rupee and current account, and higher inflation. It is the single biggest reason the market has corrected.
2. September inflation: lower, but still above 10%
The Pakistan Bureau of Statistics released September CPI today. Headline inflation eased to 10.3% from 11.1% in August. But prices still rose 1.3% in a single month, led by a 15% jump in electricity charges and about an 11% rise in motor fuel. Core inflation eased only slightly, to about 8.6% in urban areas (Pakera, TechJuice).
The reading was in line with the finance ministry's 10–11% forecast, so it was no shock. It also does little to bring a rate cut closer.
3. The State Bank on hold at 11.5%
The SBP held the policy rate at 11.5% on 14 September, its third hold in a row after a 100bp hike in April (Pakera). The vote was 7–3. With inflation above 10% and the IMF urging tight policy, a cut before inflation clearly falls looks unlikely. That matters most for rate-sensitive sectors such as cement, autos and steel.
4. The IMF review: the main upside catalyst
The IMF mission for the fourth review of the Extended Fund Facility (and the third review of the Resilience and Sustainability Facility) began around 23 September (Business Recorder). A staff-level agreement would unlock about $1.0bn from the EFF plus about $0.2bn from the RSF. Hopes of progress lifted the index by around 950 points at the open on 30 September before profit-taking set in. A signed staff-level agreement is the clearest positive trigger on the calendar.
5. Flows: locals buying, foreigners selling
In the week to 25 September, individuals (+$11.0m) and banks (+$2.6m) were net buyers, while mutual funds (−$12.7m) and foreigners (−$3.4m) sold. Foreign investors own roughly 14% of the market and have been steady sellers. The market is being held up by local money, which can be less patient than institutional money when prices fall.
Key levels on the KSE-100
The index is about 10.9% below its all-time high of 189,167, set on 23 January 2026.
| Level | Why it matters |
|---|---|
| 189,167 | All-time high (23 Jan 2026) |
| 182,200 | 60-day high |
| 173,300 | 50-day average (EMA50): the first sign of real repair |
| 171,500 | Rejected on 30 September |
| 168,000 to 168,600 | 60-day low (167,970) and 200-day average (about 168.6k): the line in the sand |
| 160,000 | Next support if 168k breaks |
| 152,000 | The April 2026 level |
Today's close sits right on this support zone. A daily close clearly below 167,970 would be the first break of the 60-day low and would shift the picture from "pullback" to "deeper correction". A move back above 173,300 would suggest the correction is over.
Scenarios to the end of 2026
These are our own judgement calls based on the drivers above, not forecasts you should rely on. The odds are rough estimates.
| Scenario | Rough odds | What has to happen | Where the index could go |
|---|---|---|---|
| Bull | about 30% | IMF staff-level agreement, Brent below $90 on a Hormuz deal, inflation falling toward single digits and talk of rate cuts | Reclaims 173k, then targets 182k and the 189k high |
| Base | about 45% | IMF deal done but oil stays at $95–105 | Range of roughly 166k to 178k, with stock picking in oil producers and banks |
| Bear | about 25% | Hormuz escalation with oil above $110, an inflation surprise or an IMF delay | A close below 168k opens 160k, then about 152k |
Brokers' street targets of 200,000 or more by December 2026 were set before the oil shock, when falling inflation and rate cuts were assumed (Express Tribune). Treat them as stale until the macro picture changes.
Sector view for October
Valuations are low. Many large companies trade on price-to-earnings ratios of 5 to 10 times with dividend yields of 7% to 13%. But in the current setup, what you own matters more than the index.
| Sector | Our view | Why | Names |
|---|---|---|---|
| Oil and gas exploration | Overweight | High oil lifts rupee revenue; gas circular-debt plan; P/E of 5.6 to 8.7 | OGDC, PPL, MARI, POL |
| Banks | Overweight for income | 11.5% rates protect margins; dividend yields of about 7% to 10% | UBL, MCB, MEBL, HBL, ABL, BAHL |
| Fertiliser | Neutral to positive | Defensive, steady dividends; gas-price risk | FFC, EFERT, FATIMA |
| Fuel marketing and refineries | Trade only | Inventory gains from high oil versus circular debt; liquid and volatile | PSO, ATRL, CNERGY |
| Cement, autos and steel | Underweight | Hurt by high rates and weak northern cement sales (August despatches −0.7% YoY, North −9.4%) | LUCK, MLCF, DGKC, INDU |
| Technology | Neutral | Benefits from a weaker rupee, but foreign sentiment is poor | SYS |
Two policy stories could help specific names. A three-year plan to cut gas-sector circular debt of about Rs 3.6 trillion would help OGDC, PPL, SNGP and SSGC if it is carried out (Pakera). Refinery upgrade deals worth about $5 billion are expected to involve ATRL, CNERGY and PRL.
For our current buy, hold and avoid signals, see signals.
How a long-term investor might approach this
If you already own PSX shares, a correction inside a long uptrend is normal. The index has more than tripled since October 2021. A few principles:
- Do not go all in at once. If you are adding money, spread it over several weeks rather than trying to pick the exact bottom.
- Prefer quality and dividends. Companies with long dividend records and low debt tend to hold up better while the macro picture is uncertain. See our dividend page.
- Avoid leverage. Margin financing turns a 10% fall into a much bigger loss.
- Know your exit plan before you buy. Active traders often use a daily close below a key level, such as about 165k on the index, as a signal to cut risk.
New to the market? Start with our beginner's guide and the learn section.
October calendar
| When | Event | Why it matters |
|---|---|---|
| 1 Oct | September CPI released: 10.3% | Done. Still too high for a rate cut |
| Early to mid Oct | End of the IMF mission and a possible staff-level agreement | The main upside catalyst |
| October | Q1 FY27 results for oil and gas producers and fuel marketers | High oil should show in earnings |
| Late October | Q3 2026 results for banks | Dividend announcements |
| Next SBP meeting | Date not confirmed: check sbp.org.pk | A hold is widely expected |
| Ongoing | US-Iran talks on Hormuz | Oil price direction |
Dividends: book closures coming up
These companies have declared cash dividends. To receive one, you must own the shares before the stock goes ex-dividend (shown with an "XD" after the symbol), which happens shortly before the book closure starts. Check the exact ex-date on the PSX notice.
| Company | Dividend | Book closure starts |
|---|---|---|
| FIMM | 100% cash | 14 Oct |
| SURC | 100% cash | 15 Oct |
| PSO | 100% cash (Rs 10) | 21 Oct |
| AHCL | 125% cash | 21 Oct |
| SHEZ | 135% cash | 21 Oct |
| SITC | 130% cash | 21 Oct |
| FEROZ | 55% cash | 21 Oct |
| NML | 20% cash | 21 Oct |
| PNSC | 100% cash | 22 Oct |
| ZAL | 100% cash | 22 Oct |
Percentages are of face value, usually Rs 10, so 100% means Rs 10 a share. The full list is on our dividends page.
The bottom line
The KSE-100 has fallen about 11% from its January peak and is now testing the support that has held for two months. Inflation eased in September but remains above 10%, rates are on hold and oil is still high. The IMF review is the best near-term hope. Watch 168k on a closing basis: a hold keeps the long uptrend intact, while a clear break opens the way to 160k.
Not financial advice. This article is general market commentary for education. Do your own research or speak to a licensed adviser before investing.
Sources
- Business Recorder: KSE-100 plunges over 1,300 points amid selling pressure (1 Oct 2026)
- Pakera: Pakistan inflation September 2026
- TechJuice: Pakistan inflation eases to 10.26% in September
- Aaj English: inflation at 10.3% in September 2026
- Pakera: SBP holds rate at 11.5%
- Business Recorder: Aurangzeb kicks off talks with IMF mission
- Express Tribune: PSX gains as IMF talks lift sentiment (30 Sep)
- TechJuice: PSX faces geopolitical risk
- Trading Economics: Brent crude
- Pakera: gas circular debt plan
- ProPakistani: cement sales fall in August
- Express Tribune: PSX to break 200,000 by December 2026
- PSX data portal (dps.psx.com.pk): index levels, end-of-day prices and payouts, 1 Oct 2026