Pakistan Stock Exchange(PSX)
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A Bearish Start: Pakistan Stock Exchange(PSX) Index Drops 1,200+ Points in Intraday Trade

The Pakistan Stock Exchange(PSX) witnessed a significant downturn today, with the benchmark KSE-100 index plummeting over 2,200 points in intraday trade. This decline comes on the heels of last week’s delayed election results and the lingering uncertainty surrounding the resolution of the circular debt management plan.

Morning Blues: KSE-100 Opens Bearish

The bearish trend was evident right from the opening bell as the benchmark KSE-100 index immediately slipped into the red zone. Starting the day at 62,943 points, it tumbled to 61,795 by 11 AM, marking a substantial loss of 1,200+ points.

Read Also: Pakistan Stock Exchange 2024: Resilience, Growth, and Investor Optimism in Pakistan’s Stock Market

Steep Decline Continues

The downturn persisted as the clock ticked, and by 11:05 AM, the index stood at 61,740, reflecting a decline of 1.91 percent or 1,203 points. The situation worsened at 2:55 PM when the index hit 60,650, down by 3.6 percent or 2,292 points. Ultimately, it settled at 61,065, registering a 2.98 percent or 1,878-point drop.

Factors Aggravating the Plunge

Election Fallout and IMF Approval Delays

Aside from the election turmoil, investors exhibited caution due to reports that the International Monetary Fund (IMF) had not yet green-lighted Pakistan’s circular debt reduction and tariff rationalization plans. The aftermath of a potential coalition government further fueled concerns among investors.

CEO Insights: Alpha Beta Core’s Perspective

Khurram Schehzad, CEO of Alpha Beta Core, expressed concern about the unprecedented decline. He noted that, contrary to historical trends, the KSE-100 index experienced back-to-back losses in the aftermath of elections, resulting in a significant erosion of values at the PSX.

Unprecedented Market Losses

The market witnessed a substantial loss in market capitalization, with each session contributing to a cumulative decline of PKR 427 billion ($1.53 billion). This stark contrast to historical post-election trends, where the market usually saw a 2-3 percent surge in the first two days, underscores the gravity of the current situation.

Path to Recovery: Addressing Economic Challenges

While investor confidence may continue to dwindle, industry experts believe that a decisive and transparent decision by the winning political parties, outlining economic strategies and addressing key challenges, could pave the way for a robust market recovery.

Sectoral Impact: Energy and Power Take a Hit

Top Volumes and Major Losers

Massive selling pressure extended to the energy and power sectors, with K-Electric Limited (PSX: KEL), Oil & Gas Development Company Limited (PSX: OGDC), and Pakistan Petroleum Limited (PSX: PPL) emerging as the top losers at the time of press.

Trading Activity Highlights

K-Electric Limited recorded the highest participation with over 50.3 million shares traded, followed by Worldcall Telecom Limited (PSX: WTL) and Oil & Gas Development Company Limited (PSX: OGDC), with 34.6 million and 14.9 million shares traded, respectively.

In conclusion, the Pakistan Stock Exchange faces unprecedented challenges, and a proactive approach from political entities is crucial for market stabilization and recovery.

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