Pakistan Stock Exchange (PSX) faced extreme volatility during the outgoing week, when the KSE-100 index suffered a historic intra-day drop of 8,688 points (-7.3%) on Monday amid global trade war fears.
The slump followed the imposition of US reciprocal tariffs on 60 countries and a fall in crude oil to $57.04 a barrel. Some recovery came later as President Trump paused tariffs for 90 days while local investors also found support from the Pakistan Minerals Investment Forum. The index lost nearly 4,000 points compared to the previous week.
On a day-on-day basis, the KSE-100 index faced a bloodbath on Monday, with the PSX mirroring escalating international trade tensions and fears of a global recession.
As Trump refused to back down from his tariff plans, retaliatory moves from China triggered fears of a broader trade war, causing markets to plunge around the world. At the close of trading, the benchmark KSE-100 index posted a decline of 3,882 points and settled at 114,909. The following day, the PSX staged a robust recovery as the index hit the intra-day high of 116,692, up 1,783 points. At the end of trading, the KSE-100 recorded an increase of 623 points at 115,532.
Following Tuesday's recovery, stocks struggled again on Wednesday, weighed down by concerns over escalating US tariffs and a global market slump. The index posted a substantial drop of 1,379 points and closed at 114,153.
On Thursday, Pakistan's stock market made a strong comeback, helping the KSE-100 surge over 2,000 points after the United States unexpectedly announced a 90-day pause to several new tariffs. At close, the index exhibited an impressive gain of 2,036 points at 116,189.
PSX on Friday wrapped up another turbulent week in negative territory as mounting global economic uncertainties and the intensifying US-China trade tensions dampened investor confidence.
The benchmark index posted a decline of 1,336 points and settled at 114,853. Arif Habib Limited (AHL) wrote in its review that the PSX endured a volatile week, during which the KSE-100 index registered a record intra-day drop of 8,688 points (-7.3%) on Monday amid global panic over reciprocal tariffs on 60 countries, which particularly impacted China.
Crude oil fell to $57.04 per barrel, its lowest since February 2021. Market sentiment improved mid-week after President Trump paused tariffs above 10% for 90 days.
Locally, investor optimism was supported by the Pakistan Minerals Investment Forum, which attracted interest from global investors. A major mineral discovery in Balochistan and Mari's significant gas find at Spinwam further lifted sentiment. Despite that, the KSE-100 closed down 3,988 points, -3.3% week-on-week (WoW), at 114,853, AHL said.
Bank, fertiliser and exploration & production (E&P) sectors led the decline while cement and pharmaceutical firms showed resilience. Foreigners turned net sellers of $9.9 million worth of shares, mainly in banks, with local mutual funds also offloading $13.6 million. Average volumes rose 14% WoW to 557 million shares while traded value went up 8% to $123 million.
Among major economic news, AHL pointed out, the State Bank of Pakistan's foreign exchange reserves rose $23 million on a weekly basis, reaching $10.7 billion. Meanwhile, the country's oil reserves saw a notable 23% increase due to new field additions, signalling a positive development for the energy sector.
In a significant move for regional energy cooperation, a Pakistani consortium is set to commence production in Adnoc's offshore block-5 by 2027. In the upstream sector, Pakistan Petroleum Limited (PPL) began gas production from the Pateji X-1 Upper Sand reservoir. Additionally, Mughal Energy is preparing to launch its coal power unit following a boiler test scheduled for June.
On the fiscal front, the government successfully raised Rs427 billion through a Pakistan Investment Bonds' (PIB) auction, AHL added. Wadee Zaman of JS Global commented that the KSE-100 index experienced heightened volatility during the outgoing week, ultimately closing down over 3,900 points at 114,853.
The week opened with a sharp sell-off, driven by fears of a global trade war, triggered by tariff announcements by the US president. However, news of a 90-day pause in tariff implementation provided some relief to investors on Thursday. Meanwhile, he said, Pakistan hosted the Pakistan Minerals Investment Forum, aimed at highlighting the country's mineral potential, with participation from major international partners.
On the economic front, the Ministry of Commerce estimated a potential loss of $1 billion due to the 29% tariff imposed on Pakistan under Trump's policy. Additionally, the Asian Development Bank revised Pakistan's GDP growth forecast down to 2.5% for FY25, Zaman added.
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