Karachi: The Board of Directors of JS Investments Limited, the management company of the JS Islamic Sarmaya Mehfooz Fund, has released its quarterly report for the period ending September 30, 2026. This report, dated October 30, 2026, provides insights into the Fund's performance in a challenging economic and financial environment.
The first quarter of fiscal year 2027 has been marked by significant geopolitical tensions, energy market disruptions, and tightening global financial conditions. These factors have directly impacted Pakistan's economy, leading to increased energy and food costs that have tested household purchasing power. Despite these challenges, Pakistan's economic momentum has shown resilience, with a recorded GDP growth of 3.7% in fiscal year 2026. The country has managed fiscal consolidation, bolstered reserves, and maintained access to external financing, which has provided some buffer against these shocks. However, inflation has reaccelerated, emphasizing the need for continued monetary and fiscal discipline.
The fixed income market in Pakistan experienced a notable repricing during this quarter. Although the State Bank of Pakistan maintained the policy rate at 11.5%, the market anticipated a prolonged restrictive monetary stance due to inflationary pressures and external factors. By the end of September, the 3-month secondary market yield was 11.64%, while 3-year and 5-year yields rose to 12.73% and 12.72%, respectively. The average headline inflation during the quarter climbed to 10.28%, which suggests that the fixed income outlook will remain sensitive to inflation persistence, energy prices, and global financial conditions.
The equity market, as assessed by the KSE-100 index, registered a decline of 5.73%, settling at 169,969 points by the end of the first quarter. This downturn was attributed to higher inflation, rising bond yields, and geopolitical uncertainties that affected investor sentiment and risk appetite. Trading activity softened, and investor participation became more selective. According to information available from the Pakistan Stock Exchange (PSX), performance varied across sectors; Refineries emerged as outperformers, whereas Cement, Power, Technology, and Commercial Banks faced setbacks. Despite some foreign selling, domestic investors absorbed much of it, although institutional flows showed mixed trends. The equity market's future will depend on earnings delivery, balance-sheet strength, and valuations that can offset the prevailing macroeconomic and market risks.
In terms of fund performance, the JS Islamic Sarmaya Mehfooz Fund's Plan 1 reported net assets of 1.73 million PKR with a return of 4.61%. In contrast, Plan 2 had net assets of 0.32 million PKR but experienced a negative return of 2.53%. The total expense ratios for the plans were 0.33% and 0.35%, respectively.
Additionally, the Pakistan Credit Rating Agency Limited (PACRA) has maintained JS Investments Limited's Asset Manager Rating at AM1 with a Stable Outlook. This rating reflects the firm's strong governance, institutionalized investment processes, and consistent operational performance, marking the highest management-quality assessment in the designated market category.