KARACHI: The Pakistan Stock Exchange (PSX) continued its downward trend on Wednesday, marking the third consecutive session of losses as investors engaged in profit-taking amid uncertainty over the outcome of the IMF’s economic review.

This review is critical for unlocking the third tranche of $1.2 billion, which is essential for Pakistan to meet its external debt obligations.

According to Topline Securities Ltd, the market began on a positive note, with the KSE-100 index gaining 773 points in early trading. However, this optimism was short-lived as institutional selling pressure, led by local institutions and insurance companies, quickly reversed the early gains. The index dropped to an intraday low of 1,063 points before closing at 165,266 points, a decline of 907 points, or 0.55 per cent.

The bearish trend was primarily driven by aggressive selling in large-cap stocks, including United Bank, Fauji Fertiliser, Lucky Cement, Mari Energy, and Bank of Punjab, which collectively contributed 944 points to the index’s drop. On the other hand, select stocks such as Systems Ltd, Bank Alfalah, and MCB Bank provided some support, contributing a combined 470 points to the index.

Despite the negative market sentiment, trading volumes remained robust. A total of 1.27bn shares were traded, with a value of Rs61bn. PTCL led the volume chart with 114 million shares.

Ali Najib, Deputy Head of Trading at Arif Habib Ltd, noted that the PSX witnessed a turbulent session, with bears tightening their grip on market momentum after an initial rally. Data from the National Clearing Company of Pakistan Ltd (NCCPL) showed that local institutions and insurers were the primary sellers, contributing to broad-based market pressure. However, high-net-worth individuals and banks were seen selectively buying, helping to stabilise the market at certain points.

On the macroeconomic front, discussions between the IMF and Pakistani authorities suggested that the country’s GDP growth target could be revised down to 3.5pc from the previous forecast of 4.2pc, largely due to the impact of recent floods on infrastructure, agriculture, and livestock. The market outlook remains cautiously balanced.

The KSE-100 index is expected to remain range-bound between 165,000 and 170,000 points in the near term, with periodic profit-taking likely to test investor sentiment. However, improving liquidity and macroeconomic signals may provide support in the longer run.

Published in Dawn, October 9th, 2025