Bears continued their stampede on Monday at the Pakistan Stock Exchange (PSX) as shares declined by more than 600 points in intraday trade.

The benchmark KSE-100 index declined by 886.10, or 0.74 per cent, to stand at 118,216.57 from the last close of 119,102.67 at 1:13pm.

At 3:04pm, the index decreased by 642.92 points, or 0.54pc, from the last close.

Mohammed Sohail, chief executive of Topline Securities, attributed the decline to “delay in budget announcement”, in addition to “lack of clarity” on the International Monetary Fund (IMF) “conditions related to budget pushing investors to trim their exposure”.

Yousuf M. Farooq, director research at Chase Securities, said, “The market is consolidating ahead of the budget, with pressure on the oil sector following media reports of disagreements with the IMF over the circular debt resolution plan and the onset of rollover week.”

“We expect a rerating to the upside once there is clarity on key budgetary measures,” he added.

The government has delayed unveiling the federal budget from June 2 to June 10 due to inconclusive discussions with the IMF on taxation and fiscal measures.

Informed sources said the visiting IMF staff mission had multiple rounds of discussion, including a wrap-up session with Finance Minister Muhammad Aurangzeb.

Awais Ashraf, director research at AKD Securities, said, “The market is concerned about delays in the release of circular debt payments to companies, as well as the potential rationalisation of tariffs in the upcoming budget.”

On a positive note, he highlighted the reduction in the primary surplus target to 1.6pc of GDP — down from last year’s 2.1pc.

He said that this was “expected to give the government some fiscal space to avoid imposing harsh new taxes, unlike the pattern seen over the past three years”.

“Although the room for significant relief is limited, we expect a relatively more people-centric budget, with emphasis on executing the comprehensive tax reforms initiated under the IMF programme over the last two years,” he said.

On Friday, the stock market had come under renewed selling pressure, forcing the index to close the outgoing in the red as jittery investors trimmed their positions amid fears of an unfriendly IMF-driven federal budget.

Contrary to the preceding week, when the benchmark KSE 100 index recovered a staggering 12,474 points thanks to a US-brokered ceasefire between two nuclear-armed neighbors, the PSX faltered due to lacklustre conditions as investors preferred to remain on the sidelines before the announcement of the budget 2025-26.

More to follow