Bears take hold of PSX as shares decline 1,200 points due to IMF review concerns

Published
0
Downward trajectory witnessed at the Pakistan Stock Exchange (PSX) on Monday — PSX data portal
Downward trajectory witnessed at the Pakistan Stock Exchange (PSX) on Monday — PSX data portal

Bears took control of the trade floor at the Pakistan Stock Exchange (PSX) on Monday as shares declined by 1,200 points.

The benchmark KSE-100 index declined by 1,207.25 points, or 1.07 per cent, to stand at 112,044.41 points from the last close of 113,251.66 at 1:32pm.

Finally, the index closed at 111,986.88, down by 1,264.78 points or 1.12pc, from the previous close.

Yousuf M. Farooq, director research at Chase Securities, said, “Shares worth only Rs18 billion were traded today on the first day of Ramazan, as market activity remained subdued due to shorter trading hours — Ramazan typically sees lower participation.”

He noted that investors were now focused on the upcoming International Monetary Fund (IMF) review.

Pakis­tan and the IMF had reached a three-year, $7bn aid package deal in July 2024, with the new programme set to allow the country to “cement macroeconomic stability and create conditions for stronger, more inclusive and resilient growth”.

The ongoing 37-month Extended Funded Facility programme consists of six reviews over the life of the bailout, and the release of the next tranche of approximately $1bn will be contingent on the success of the performance review.

“While most expect a smooth process, some concerns remain over the country’s ability to broaden its tax base,” Farooq stated, adding that the current account — though stable — showed “signs of weakness in the latest reading”.

“Inflation is expected to remain low in the near term but is likely to rebound from April,” Farooq highlighted. “Despite the cautious sentiment, the market continues to offer opportunities for long-term investors seeking value and could rally once there is greater clarity on the IMF programme.”

Sana Tawfik, head of research at Arif Habib Limited, attributed the downward trajectory “selling pressure” in the market.

“Due to the Ramazan factor, low volumes also being observed,” she added.

According to Insight Securities Ltd, the market posted a slightly negative performance in February.

The market continued its bearish trend for the second month in a row, primarily due to anxious selling by investors in February. This uncertainty stemmed from concerns about tax reforms and the outcome of the upcoming first review of the $7 billion Extended Fund Facility by the IMF.

Last week, the equity investors had remained cautious throughout the month and opted to take profits at available margins. A successful IMF review would lead to the release of the second tranche, which the country direly needed to meet its external debt repayment obligations.

The State Bank of Pakistan’s (SBP) foreign exchange reserves had also recorded an uptick of $21m to $11.2bn while the rupee depreciated slightly by 0.04pc, closing at Rs279.57 against the dollar.

Follow Dawn Business on X, LinkedIn, Instagram and Facebook for insights on business, finance and tech from Pakistan and across the world.

Opinion

Editorial

Referendum talk
Updated 14 Nov, 2026

Referendum talk

Unless the PPP is deliberately using Sindh as a bargaining chip, it should issue a clarification with a clear, consistent position on new administrative units, not one tailored to protect its home turf.
Mineral wealth
Updated 14 Nov, 2026

Mineral wealth

PAKISTAN’S mineral wealth offers an opportunity to attract investment, earn foreign exchange and support long-term...
Late diagnosis
14 Nov, 2026

Late diagnosis

AS we mark World Diabetes Day today, Pakistan faces a troubling question: how many people are living with diabetes...
Climate challenges
Updated 13 Nov, 2026

Climate challenges

Pakistan cannot afford to confront its climate crises one disaster, one season and one international summit at a time.
Under fire
Updated 13 Nov, 2026

Under fire

KP police are increasingly vulnerable as they play a frontline role in ongoing operations against terrorists.
Used car imports
13 Nov, 2026

Used car imports

THE government’s effort to restrict used car imports appears to be faltering. So suggest the numbers. Despite...