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KARACHI: The Pakistan Stock Exchange (PSX) on Tuesday showed a strong upward movement in early trading following another cut in the interest rate. However, towards the end of the session, widespread selling pressure pushed the KSE 100 index into the red, extending overnight losses. Investors’ sentiments remained bearish due to ongoing border tensions.
Ahsan Mehanti from Arif Habib Corporation stated that the market closed lower due to the State Bank of Pakistan’s cautious approach to monetary policy easing amid ongoing tensions with India and global uncertainties related to trade tariffs and geopolitical risks. However, the trade and industry leaders insisted that the cut was insufficient to stimulate economic activity.
Moody’s caution over sustained Pak-India tensions to derail economic stability, warning on external financing risks amid the Kashmir crisis led to a bearish close at the PSX.
Topline Securities Ltd said the trading began on a buoyant note as a much-anticipated 100bps policy rate cut lifted investor sentiment, the benchmark index surged to an intraday high of 990 points. However, the early celebrations were short-lived.
As the day progressed, profit-taking emerged across key sectors, gradually eroding the morning gains. The index ultimately succumbed to selling pressure, hitting an intraday low of 683 points and closing the session at 113,568 level — down by 533 points or 0.47pc day-on-day.
The reversal in market trajectory was primarily driven by renewed geopolitical tensions between Pakistan and India, which unsettled investors and overshadowed the central bank’s dovish stance.
Key heavyweight stocks that provided upward support included Pakistan Petroleum, Oil and Gas Development Company, PSO, United Bank, and Systems Ltd, cumulatively contributing 275 points to the index.
Conversely, Lucky Cement, Habib Metropolitan Bank, Hub Power, Engro Fertiliser, and Bank Al-Habib collectively shaved off 427 points, weighing heavily on overall performance.The market participation was strong as the trading volume rose 5.25pc to 420.55 million shares, and the traded value rose 19.36pc to Rs23.69 billion day-on-day.
Published in Dawn, May 7th, 2025
