• Index plunges 5,149 points, wiping Rs577.7bn off investor wealth
• Volatility persists as IMF review mission looms

KARACHI: Extending its bearish spell for the third straight session on Monday, the Pakistan Stock Exchange (PSX) witnessed a bloodbath as panicky investors rushed to offload their holdings from the start of trading, forcing the benchmark KSE-100 index into a free-fall, sinking as many as 6,029.47 points below the 174,000 level intraday.

Before the end of trading hours, the index recovered some of the lost ground on value-buying and closed with a loss of 5,149.79 points (the third-largest plunge in absolute numbers) or 2.87pc at 174,453.94, causing a staggering loss of Rs577.7 billion to equity investors amid persistent volatility.

Topline Chief Executive Mohammed Sohail said the benchmark index lost 5 per cent in the last three sessions, including a sharp, almost three per cent drop on the first day of this week, largely driven by aggressive foreign selling.

Quoting data from the National Clearing Company of Pakistan Ltd, he said foreign corporates were net sellers of nearly $25 million in the last two sessions.

However, he added that foreign investors have been consistent sellers for years — offloading $400m in 2025 alone — yet the market rallied 50pc last year on the back of macro stability, stable rupee, and lower interest rates.

“This correction appears more flow-driven than fundamentals-driven,” he remarked.

The brokerage in its market commentary also noted that escalating political noise further dampened investor confidence, intensifying the bearish momentum.

Index-heavy constituents, including Fauji Fertiliser Company, United Bank Ltd, Engro Holdings, Habib Bank Ltd, and Bank Al-Habib Ltd, emerged as the primary laggards, collectively eroding 1,680 points from the benchmark during the session.

However, trading volume rose 9.07pc to 773 million shares while the traded value increased 18.91pc to Rs46.1 billion. K-Electric continued to dominate the volume chart, leading the market with over 63m shares traded.

In response to Dawn’s queries, Ali Najib, Deputy Head of Trading at Arif Habib Ltd (AHL), said the benchmark index endured a sharp sell-off, causing a 9.49pc plunge from its January peak of 191,000, reflecting a meaningful correction.

He said the session was characterised by heavy selling pressure, as profit-taking, partly attributed to Barrick Gold’s security review narrative of the $6-$7bn Reko Diq copper-gold project in Balochistan, combined with seasonal Ramazan slowdown in cyclicals, limited expectations of a near-term rate cut, geopolitical uncertainties, and an underwhelming earnings season. These factors collectively contributed to fragile investor sentiment.

On the corporate front, Bank Alfalah Ltd reported CY25 earnings per share of Rs17.67, down 30pc year-on-year and announced a dividend of Rs10.5, along with a 2:1 stock split. Additionally, an IMF review mission is scheduled to arrive on Feb 25 for a two-week assessment of Pakistan’s economic performance from July to December 2025.

Commenting on outlook, Mr Ali said that with Ramazan approaching, trading volumes at the bourse may remain subdued. However, markets often stabilise after sharp corrections. “If IMF clarity and macro stability emerge, consolidation is likely. Selective buying in banks, E&Ps, and fertilisers could appear despite muted participation,” he asserted.

However, he hoped the IMF review would most likely go smoothly, while super tax charges have reduced corporate profitability and dividend expectations.

The sell-off reflects combined macro anxiety and weaker earnings visibility rather than a single isolated trigger, stressed.

He was of the view that today’s bloodbath has weakened the market’s near-term technical structure. Going forward, the 172,000-170,000 range is likely to serve as the next strong support zone, while 180,000 has now turned into the immediate resistance level for any potential recovery, he noted.

Published in Dawn, February 17th, 2026