PSX Pulls Back After Historic Rally
After hitting record highs earlier this week, the Pakistan Stock Exchange (PSX) witnessed a sharp reversal on Thursday as the KSE-100 index plunged 1,356 points (0.90%), closing at 149,235 points.
The market opened on a bullish note, with the benchmark touching an intra-day peak of 151,250 points (+659), but political developments and profit-taking triggered a broad sell-off that dragged the index down to 148,273 points (-2,318) before partial recovery.
Political Uncertainty Weighs on Sentiment
The sharp downturn followed the Supreme Court’s acceptance of bail pleas of former PM Imran Khan in May 9 cases, which sparked renewed political uncertainty.
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Mohammed Awais Ashraf (AKD Securities) noted that while sentiment turned cautious, “falling interest rates and exchange rate stability should sustain the equities rally going forward.”
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Ali Najib (AHL) called it a “session where politics overshadowed fundamentals,” though he highlighted that late recovery reflected resilience in investor confidence.
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Muhammad Hasan Ather (JS Global) termed the dip a “healthy correction” as investors locked in gains after a strong earnings season.
Sector-Wise Performance
The decline was led by index-heavy sectors:
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Commercial banks: -818 points
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Cement: -187 points
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Fertiliser: -128 points
Despite the overall weakness, selective buying in Searle, OGDCL and Systems Limited added 210 points to the index.
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Market Activity
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Trading volumes: 1.1 billion shares (up from 667.8m on Wednesday)
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Traded value: Rs55.8 billion
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Companies traded: 480 (130 advanced, 323 declined, 27 unchanged)
Top volume leaders:
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Fauji Foods — 62.1m shares, +Rs0.52, closed at Rs16.94
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Pak Elektron — 57.2m shares, +Rs3.03, closed at Rs45.36
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Telecard Limited — 56.9m shares, +Rs0.23, closed at Rs8.34
Foreign investors sold shares worth Rs479 million, according to the National Clearing Company.
Investor Outlook
While political noise triggered volatility, analysts maintain that the broader market trend remains positive, supported by:
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Lower interest rate environment
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Stable exchange rate
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Improving macroeconomic indicators
Short-term fluctuations are likely, but institutional support and resilient corporate fundamentals may cushion downside risks.
Conclusion
The PSX’s dip to 149,235 points marks a healthy correction after a record-breaking rally. Political uncertainty overshadowed fundamentals for the day, but improving economic indicators and lower interest rates suggest the market’s long-term outlook remains constructive.
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