KARACHI: Foreign investors turned net buyers at the Pakistan Stock Exchange (PSX) in July, marking the first monthly net inflow in nearly two years and signalling improving international confidence in Pakistan’s capital market at the start of the new fiscal year.
According to the latest market data available with MM News, overseas investors injected $34.4 million into the PSX during July 2026, a sharp turnaround from June, when they remained net sellers after offloading shares worth $180 million.
The reversal marks the first time in 23 months that foreign investors have emerged as net buyers rather than sellers, reflecting a notable shift in sentiment towards Pakistani equities after a prolonged period of capital outflows.
The renewed foreign interest was concentrated in blue-chip sectors, particularly banking and oil and gas exploration, which have remained among the key beneficiaries of Pakistan’s improving macroeconomic indicators and relatively attractive valuations.
Data showed that foreign investors purchased shares worth $13.8 million in the banking sector, making it the biggest recipient of overseas investment during the month.
The exploration and production (E&P) sector followed, attracting $6.7 million in net foreign buying as investors increased exposure to energy stocks.
In contrast, the cement sector witnessed net foreign selling during July, indicating a sectoral shift in investment preferences despite the broader improvement in market sentiment.
The latest figures come as the PSX has shown signs of renewed strength in recent weeks. The benchmark KSE-100 Index ended the last trading week 5,072 points higher at 176,094, while overall market capitalisation expanded by Rs477 billion to Rs19.755 trillion, underscoring growing investor confidence despite intermittent bouts of volatility.
Market analysts believe the return of foreign portfolio investment is an encouraging development for Pakistan’s equity market, as sustained overseas inflows typically improve market liquidity and reinforce confidence among domestic institutional and retail investors.
