The Pakistan Stock Exchange (PSX) remained volatile on Friday as investors adopted a cautious stance amid ongoing IMF review talks and rising geopolitical and global economic headwinds.
The KSE-100 Index dropped 2,119.55 points (1.29%), touching an intraday low of 162,411.25, after briefly rising to 165,262.85 points earlier in the session. The market closed well below the previous day’s level of 164,530.8 points, reflecting investor unease over both domestic and global developments.
“Stocks are under pressure due to geopolitical tensions and security unrest,” said Ahsan Mehanti, Managing Director and CEO of Arif Habib Commodities, adding that weaker global crude oil prices and concerns over the U.S. government shutdown and tariff disputes triggered bearish activity at the bourse.
Global sentiment also turned fragile as the U.S. government shutdown entered its third week, with lawmakers failing to pass a funding bill — rattling financial markets and heightening fears of a slowdown in the world’s largest economy.
At home, investors remained anxious over delayed progress in Pakistan’s IMF staff-level agreement. Sources confirmed that disagreements persisted on external financing frameworks and the Governance and Corruption Diagnostic (GCD) report, both critical elements of the IMF’s Memorandum of Economic and Financial Policies (MEFP). However, officials expressed optimism that these issues could be resolved within two weeks.
On the macroeconomic front, the State Bank of Pakistan (SBP) reported an 8.41% rise in remittances, reaching $9.54 billion in the first quarter of FY2025–26, while foreign exchange reserves rose modestly to $14.42 billion, even after the repayment of $500 million in Eurobonds.
Analysts say the market’s cautious tone reflects uncertainty about fiscal direction and global risks rather than fundamental weakness. “If Pakistan manages to close the IMF deal soon, investor confidence could rebound sharply,” one trader noted.
The session’s swings underscore how the PSX — despite resilient domestic inflows — remains deeply influenced by external shocks and policy clarity.
