Pakistan’s capital market experienced a significant downturn on Monday as escalating tensions with India unsettled investors, leading to widespread selling pressure across various sectors and causing the benchmark index to fall sharply.
The benchmark KSE-100 index plummeted by 1,405.44 points, or 1.22%, to close at 114,063.90, after fluctuating between an intraday high of 116,658.94 and a low of 113,867.80 during the trading session. The total volume of shares traded reached 190.2 million, with a total value of Rs20.5 billion.
At the previous market close, the index had stood at 115,469.34.
Topline Securities, in its post-market analysis, noted that the Pakistan Stock Exchange (PSX) witnessed a classic battle between bullish and bearish sentiments on Monday.
“The index commenced trading on a positive note, gaining strong upward momentum in the early hours to reach an intraday peak of 1,189 points,” the brokerage reported.
“However, this optimism proved short-lived as intensified selling pressure later in the session caused a sharp reversal in the index’s trajectory, touching an intraday low of 1,601 points.”
The brokerage highlighted that the prevailing negative sentiment was largely fueled by the increasing tensions between India and Pakistan, which heightened investor concerns and significantly dampened overall market confidence.
On a positive note, Systems Limited, Lucky Cement, Meezan Bank Limited, and Habib Bank Limited collectively contributed 489 points to the index’s performance. Conversely, Engro Corporation, United Bank Limited, Mari Petroleum Company Limited, Engro Fertilizers, and Pakistan State Oil Company together eroded 907 points from the benchmark index.
“Despite the risk-averse sentiment dominating the market, overall participation remained robust, with trading volumes reaching 421 million shares and a turnover of Rs26.43 billion,” the brokerage added.
Samiullah Tariq, Head of Research at Pak-Kuwait Investment Company, informed Geo.tv that the market decline was attributable to profit-taking activities following the sharp upward movement earlier in the trading session.
The PSX had opened strongly, bolstered by positive developments over the weekend, including Pakistan’s successful diplomatic efforts at the United Nations Security Council regarding the Pahalgam attack.
This initial positive momentum had boosted investor confidence, carrying forward the trend from the previous week, which had seen significant market volatility due to tensions between Pakistan and India.
Furthermore, reports indicating progress in US-China trade negotiations had helped alleviate fears of a prolonged trade war, improving sentiment across global equity markets, including Pakistan’s.
China, while denying ongoing tariff negotiations, exempted certain US goods from retaliatory tariffs, signaling a slightly more conciliatory stance. It has also urged Washington to cease threats and pressure tactics to foster a more conducive environment for dialogue.
“The improvement in international sentiment contributed to a positive atmosphere in local markets,” Mustafa Mustansir, Director of Research and Business Development at Taurus Securities Limited, had told Geo.tv earlier in the day.
Pakistan’s positive standing at the World Bank and IMF Spring Meetings, coupled with robust corporate earnings reports, had initially supported bullish sentiment. However, despite this early surge, investors ultimately chose to capitalize on their gains by the end of the session, leading to the market’s eventual downturn.
