Stocks in Pakistan fall after initial gain, KSE-100 Index concludes more than 1,400 points below closing mark.
Reinvigorated Trading at the Pakistan Stock Exchange (PSX), but Volatility Returns
After an initial flourish, the KSE-100 Index plunged into the red territory, shedding over 1,400 points during trading on Monday, marking a 1.22% decrease.
The session commenced on a positive note, with the index hitting a high of 116,658.95 during the morning hours. However, a formidable selling push in the latter part of the day dragged the index to a low of 113,867.81. The closing bell rang with the benchmark index standing at 114,063.90.
"Today's trading session was a see-saw battle between the bulls and bears. The index began with a bang, surging powerfully in the early hours, reaching an intraday high of 1,189 points. Yet, the enthusiasm was fleeting, as robust selling pressure towards the end of the session caused the index to revers swiftly, touching an intraday low of 1,601 points," reported Topline Securities in their post-market analysis.
In essence, the prevailing market sentiment was largely swayed by the mounting tensions between India and Pakistan, which exacerbated investor concerns and dampened overall market confidence.
On the bright side, SYS, LUCK, MEBL, and HBL synergized to add 489 points to the index. Conversely, ENGROH, UBL, MARI, EFERT, and PSO were the major detractors, subtracting 907 points from the benchmark, as per Topline Securities' assessment.
Last Friday, the index had concluded at 115,469.35. The escalating hostilities between Pakistan and India following the Pahalgam attack had kept the stock market under strain, causing the KSE-100 to slump by 1.57% over the past week.
"This downturn can be attributed to the worsening relations with India and the ongoing futures rollover week. Another crucial development during the previous week was Pakistan reaching an understanding with two foreign commercial banks for a $1 billion loan at a rate of around 7.6%, and news that the government planned to raise debt from the domestic capital market by issuing Pakistan's first sustainable investment asset-backed Sukuk bonds for funding three clean energy projects, requiring an additional Rs52 billion," as reported by Topline Securities.
The tug of war between Pakistan and India plummeted to its lowest point in years, with allegations and counter-allegations flying thick and fast. India accused Pakistan of supporting "cross-border terrorism," following a series of attacks in Illegally Occupied Jammu and Kashmir (IIOJK). Pakistan fiercely denied these accusations.
The two nuclear-armed nations retaliated with a series of retaliatory measures. India wavered on implementing a critical water-sharing treaty and closed its airspace to Pakistani airlines. Meanwhile, Pakistan barred Indian airlines from its airspace.
International markets and the dollar were hesitant as the uncertainty surrounding US trade policy persisted, with little indication of resolution. Although US President Donald Trump announced progress in talks with China and several other countries, Treasury Secretary Bessent failed to support these claims during a recent interview.
"The uncertainty itself is as damaging as the tariffs themselves, adversely impacting the US economy, at least as much as the rest of the world," remarked Christian Keller, head of economics research at Barclays. "Even if the ongoing earnings season continues to reveal robust numbers, many corporations are likely to prepare for a defensive stance until visibility improves. This makes a recession increasingly likely."
At the local level, the Pakistani rupee recorded a modest decline against the US dollar, shedding 0.03% during trading in the inter-bank market on Monday. The currency closed at 281.07, having lost Re0.10 compared to the previous day's close.
Volume on the all-share index fell to 423.94 million from 471.07 million recorded in the previous close. The value of shares slipped to Rs26.46 billion from Rs27.31 billion in the preceding session. B.O.Punjab headed the volume list, followed by Power Cement and WorldCall Telecom.
Overall, 449 companies traded on Monday, with 93 posting gains, 313 suffering losses, and 43 remaining steady.
- The trading session at the Pakistan Stock Exchange (PSX) intensified, but volatility returned as the KSE-100 Index plunged into the red territory.
- The session started positively, with the index hitting a high of 116,658.95 during the morning hours, but a selling push in the latter part of the day dragging the index down.
- Topline Securities reported that the trading session was a see-saw battle between the bulls and bears, with the index surging powerfully in the early hours, but swiftly reversing due to robust selling pressure towards the end.
- The prevailing market sentiment was influenced by mounting tensions between India and Pakistan, exacerbating investor concerns and dampening overall market confidence.
- Companies like SYS, LUCK, MEBL, and HBL helped to add 489 points to the index, while ENGROH, UBL, MARI, EFERT, and PSO were the major detractors, subtracting 907 points from the benchmark.
- The index had concluded at 115,469.35 the previous Friday, and over the past week, the KSE-100 was affected by escalating hostilities between Pakistan and India and the ongoing futures rollover week.
- Topline Securities also reported another crucial development during the previous week: Pakistan reaching an understanding with two foreign commercial banks for a $1 billion loan at a rate of around 7.6%, and news that the government planned to raise debt from the domestic capital market by issuing Pakistan's first sustainable investment asset-backed Sukuk bonds for funding three clean energy projects, requiring an additional Rs52 billion.
- The ongoing tensions between Pakistan and India plummeted to its lowest point in years, with allegations and counter-allegations flying thick and fast.
- International markets and the dollar were hesitant as the uncertainty surrounding US trade policy persisted, with little indication of resolution.
- Christian Keller, head of economics research at Barclays, commented that the uncertainty itself is as damaging as the tariffs themselves, adversely impacting the US economy, at least as much as the rest of the world.
- At the local level, the Pakistani rupee showed a modest decline against the US dollar in the inter-bank market, shedding 0.03% during trading on Monday. B.O.Punjab headed the volume list on the all-share index, with overall trading involving 449 companies, 93 of which posted gains, 313 suffered losses, and 43 remained steady.
