KARACHI: The stock market on Tuesday snapped its four-session winning streak as investors indulged in profit-taking at elevated levels, amid a widening trade deficit and renewed political friction that dampened risk appetite, forcing the benchmark index to slip back below 168,000 points after a volatile session marked by sharp intraday swings.

The session opened on an upbeat note, with the KSE-100 surging to an intraday high of 169,289 — up 1,227 points and barely 700 points shy of the all-time peak of 169,989 touched on Oct 3. But the early momentum faded quickly as blue-chip energy and banking counters faced brisk selling, dragging the index down by 792 points, erasing early gains.

Sentiment weakened further amid heightened political uncertainty. The government’s signalling of possible governor’s rule in Khyber Pakhtunkhwa — against the backdrop of deteriorating law and order in Balochistan and KP — unsettled investors already wary of the fragile macroeconomic environment.

According to Topline Securities, after several sessions of advances, the market “paused for breath”, with profit-taking dominating trade. Despite the pullback, the brokerage maintained that the broader tone remained constructive, with investors awaiting fresh catalysts to guide direction.

Ali Najib, Deputy Head of Trading at Arif Habib Ltd, told Dawn that equities were holding firm despite “grim macro and political headlines” becau­­se markets tend to move on expectations rather than present discomfort.

“Investors are betting on monetary stability, record-low inflation, robust corporate earnings and excess liquidity chasing a few asset classes,” he said. With real estate stagnant and bond yields largely priced in, equities remained the preferred high-return option.

He added that optimism over the IMF programme’s continuity, as its executive board is set to approve $1.2bn on Dec 8, progress on the Reko Diq copper-gold project as it approaches financial close, and expectations of an index re-rating were keeping sentiment buoyant. “The market is celebrating the future outlook, not the current mess,” he remarked, noting that buying interest persisted despite the widening current account deficit, political noise and weak foreign direct investment.

Throughout the session, the index oscillated between a high of 169,289 and a low of 167,445, reflecting a tussle between opportunistic sellers and selective buyers. The benchmark eventually settled at 167,642.28 — down 419.91 points, or 0.25pc.

Among major contributors, Lucky Cement, Bestway Cement Ltd, Meezan Bank and Faysal Bank collectively added 389 points. In contrast, Fauji Fertiliser, Pakistan Petroleum, Hub Power, Systems Ltd and Engro Corporation pulled the index down by a combined 569 points.

Market participation remained resilient. The total trading volume rose 5.44pc to 775.53 million shares, though the traded value slipped 18.81pc to Rs37.4bn.

Published in Dawn, December 3rd, 2025