PSX drops 0.94% as market fragility prompts profit-taking, cautious investor sentiments

The Pakistan Stock Exchange witnessed yet another volatile session on Tuesday, with the KSE-100 index shedding 1,578.66 points, or 0.94%, to close at 166,173.75.

After opening on a slightly positive note, the index touched an intra-day high of 168,518.97, but selling pressure resurfaced, dragging the index down to an intra-day low of 165,997.21, nearly revisiting Monday’s bottom.

This marks the second consecutive session of downward movement, following a 0.73% drop on Monday. Despite early optimism, investor sentiment remained cautious, prompting widespread profit-taking across key sectors.

The KSE-100’s inability to sustain gains and its retreat to the 166,000 level highlights the market’s current fragility. With no strong triggers in sight, the index appears to be in a consolidation phase, hovering around key support zones.

Additionally, sentiment remained cautious over the State Bank of Pakistan’s (SBP) Governor Jameel Ahmad’s assertion that inflation is holding steady, although further interest-rate cuts will depend on the impact of the recent floods and the outcome of an ongoing International Monetary Fund (IMF) review, Bloomberg reported. 

Market participants remain on alert, watching for any economic or political cues that might break the ongoing selling streak.
Arif Habib Limited (AHL) observed that Tuesday was the second session of selling pressure with the KSE-100 trading down to Monday’s low of 166,000.

Some 26 shares rose while 73 fell with Habib Bank (+3.56%), Engro Fertiliser (+1.54%) and Askari Bank (+3.85%) contributing the most to index gains. On the flip side, Hub Power (-3.75%), Engro Holdings (-2.7%) and Lucky Cement (-3.09%) were the biggest index drags, it said.

In monetary news, the SBP Governor sees inflation holding steady, although further interest-rate cuts will depend on the impact of the recent devastating floods and the outcome of an ongoing IMF review.

We see that 166,000 is setting up as a key level for the index, which will need to immediately regain 167,200 to target the 170,000 level, AHL added.

Overall trading volume slightly decreased to Rs1.26 billion from Monday’s tally of 1.27b. Value of shares stood at Rs54.2b.

Shares of 487 companies were traded. Of these, 183 closed higher, 267 fell and 37 remained unchanged. Pakistan Telecommunication Company was the volume leader with trading in 189.7 million shares, falling by Rs0.27 to close at Rs31.14.