The Pakistan Stock Exchange (PSX) closed bearish on Tuesday as investors remained cautious owing to pre-budget uncertainty. Market participants were vigilant, anticipating parliamentary approval of IMF-driven tax reforms, including the phasing out of industrial incentives and the implementation of new tax levies on the agricultural sector.
The benchmark KSE-100 index swung between the intra-day high of 211 points and the intra-day low of 1,163 points, before closing at 118,971, a decline of 719 points, or 0.60%.
Market participation remained modest, with trading volume standing at 438 million and traded value shrinking to Rs21 billion.
According to Ahsan Mehanti of Arif Habib Corp, stocks closed lower amid pre-budget uncertainty and concerns over parliamentary approval of IMF-driven tax measures in the FY26 federal budget, including the phasing out of industrial incentives and implementation of tax reforms for the agricultural sector.
He added that the International Monetary Fund's (IMF) warning over external risks from the US tariff policies and escalating tensions with India impacted sentiment. Moreover, falling global crude oil prices and rupee fluctuation also played a role in bearish close at the PSX.
At the end of trading, the benchmark KSE-100 index recorded a decrease of 718.51 points, or 0.60%, and settled at 118,971.13. In its review, Topline Securities commented that the stock market remained volatile, reflecting a day of consolidation. The benchmark index recorded the intra-day high of 211 points and low of 1,163 points, eventually closing at 118,971, down 719 points.
The decline was attributed to persistent profit-taking, compounded by the absence of any positive triggers, it said. Key heavyweights including Fauji Fertiliser Company (FFC), UBL, HBL, Pakistan Petroleum and Engro Holdings collectively contributed to a decline of 386 points in the index, Topline added.
Arif Habib Limited (AHL), in its report, said that the KSE-100 index failed to test 120k and gave up 0.6% day-on-day to close below 119k.
Some 41 shares rose while 55 fell with Habib Metropolitan Bank (+2.88%), DG Khan Cement (+2.12%) and Meezan Bank (+0.51%) contributing the most to index gains. On the flip side, FFC (-1.02%), UBL (-1.17%) and HBL (-2.33%) were the biggest drags.
AHL pointed out that the government had lowered its economic growth projection due to global trade disruptions and tighter spending conditions of the IMF. The GDP is estimated to expand 2.68% compared with earlier projection of 3.6% for the current year.
Insight Securities' Head of Sales Ali Najib noted that the PSX witnessed some selling as investors took a cautious stance ahead of the budget.
The upcoming budget and the potential introduction of new policies or tax measures were being closely watched by the market. Consequently, a wait-and-watch approach was being adopted by investors as they sought greater clarity before any significant investment decisions, he said.
JS Global analyst Muhammad Hasan Ather commented that bears dominated the PSX where investors adopted a cautious stance, preferring to book profits ahead of the federal budget for FY26.
During the session, the index touched the intra-day high of 119,900 and low of 118,527. Some buying interest emerged in cement stocks towards the end of the day, driven by hopes of budgetary incentives for the construction sector, Ather mentioned.
"Going forward, we advise investors to consider any dips as buying opportunities, particularly in oil & gas, technology, textile and steel stocks," he added.
Overall trading volumes increased to 437.9 million shares compared with Monday's tally of 425.4 million. The value of shares traded during the day was Rs20.8 billion. Shares of 473 companies were traded. Of these, 177 stocks closed higher, 232 fell and 64 remained unchanged.
At-Tahur Limited was the volume leader with trading in 39.6 million shares, gaining Rs3.56 to close at Rs49.69. It was followed by Fauji Foods with 30.3 million shares, falling Rs0.47 to close at Rs15.81 and Gul Ahmed with 29.1 million shares, gaining Rs1.26 to close at Rs23.97. During the day, foreign investors bought shares worth Rs176.3 million, the National Clearing Company reported.
COMMENTS
Comments are moderated and generally will be posted if they are on-topic and not abusive.
For more information, please see our Comments FAQ