PSX opens on a cautionary note

KARACHI: The Pakistan Stock Exchange (PSX) closed in red on Tuesday after the steep fluctuations seen on two trading days of the week. On Monday then index went through a sharp bullish period closing with over 4,400 points growth. Tuesday brought quick gains in the opening moments of trading but then volatility set in.

Also read: PSX jumps then slumps; early Tuesday trading sees volatility

Today (Thursday), the benchmark KSE-100 index opens after the Quaid Day/Christmas holiday at Tuesday’s closing of 112,414.80 points, with the investment sentiment still uncertain. The overall macroeconomic indicators remain encouraging, but the sharp rises witnessed by the index also poses the risk of correction setting in.

On the positive side, the central bank’s decreased policy rate is still offering momentum to the investors. The negotiations between the government and opposition coalitions are also signaling political stability in the near future. The parliament is also returning to discussions on internet connectivity and power generation. All of this is good for offering certainty to the investors, both local and foreign, towards investing in the market.

On the flipside, the situation on the international front with Afghanistan as well as at home in Kurram is dampening the security sentiment. The shortage of gas supply in the heart of winter is also raising uncertainty for the energy sector, making it increasingly dependent on government policies going forward.

FINANCE ADVISOR MEETS PSX CEO

Earlier this week, Advisor to the Finance Minister Khurram Schehzad met with PSX CEO Farrukh Sabzwari to discuss measures for fostering the capital market in Pakistan. Some of the suggestions that came under discussion included high-value public listings, expanding the investor base, launching new investment products, and inculcating modern trading strategies.

Also read: Government and PSX collaborate to unlock capital market potential

The advisor also suggested formation of a committee comprising representatives from the PSX, State Bank of Pakistan (SBP) and the Securities and Exchange Commission of Pakistan (SECP). He said that such collaboration is essential to promote financial inclusion, enhance public awareness, and facilitate seamless digitisation within the capital markets.