Stock market bleeds, PSX loses 1,242.14 points

KARACHI: The Pakistan Stock Exchange witnessed a major loss on Thursday, registering its fifth successive decline with a loss exceeding 1,700 points at one point, mainly due to speculations regarding an impending interest rate hike, prevailing economic ambiguity, and the relentless devaluation of the Pakistani currency.

By the time trading ceased, a slight recovery had occurred, with the index resting at 45,002.41, marking a decline of 1,242.14 points, equivalent to a 2.69% drop from the preceding day’s closing of 46,244.55.

The trading day commenced with a ten-minute period of stagnation following the opening bell. However, the market’s fortunes took a downturn at 9:40am, gradually spiraling downward. The KSE-100 index, a benchmark of the bourse’s performance, recorded a decline of 659 points by noon, settling at 45,584.62. The situation worsened after 2:50pm, as the market experienced a steep plunge of 1,784.93 points, reaching an intraday low of 44,459.62.

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The sharpness of this decline had not been witnessed since the aftermath of former Prime Minister Shehbaz Sharif’s announcement of a 10% “super tax” targeting large-scale industries in June 2022.

Raza Jafri, the Equity Head at Intermarket Securities, expressed his insights to Dawn.com, affirming that the KSE-100 index remained ensnared in a web of substantial selling pressure due to prevailing market skepticism, stemming primarily from a fragile economy and the continuous depreciation of the national currency.

Jafri noted, “The return of value buyers might be anticipated in the event of an extended market dip, yet a significant valuation rerating hinges upon the attainment of a clearer economic outlook.”

The consecutive losses incurred by the Karachi Stock Exchange underscore the delicate equilibrium of market sentiments amidst a challenging economic backdrop.