PSX slides over 1,600 points amid Pak-Afghan peace deadlock

Pakistan Stock Exchange came under heavy selling pressure as investors reacted to renewed tensions following strained relations between Pakistan and Afghanistan and mixed earnings reports.

The benchmark KSE-100 index tumbled 1,635.97 points, or 1.02%, ending the day at 158,465.06 on Wednesday. Throughout the session, the index fluctuated between a high of 160,690.12 and a low of 158,306.84.

Market sentiment stayed weak after peace talks between Islamabad and Kabul failed to yield progress, adding to concerns already weighing on investors. Analysts believe that the correction phase is likely to continue in the near term as traders remain cautious amid uncertain political and economic signals.

KTrade Securities wrote that PSX continued to remain under selling pressure as the absence of positive catalysts continue to dampen investor confidence. The benchmark KSE-100 Index further declined by 1,635 points, 1.02%, settling at 158,465 points.

It attributed the decline largely to several factors, including the breakdown of negotiations between Pakistan and Afghanistan, which weighed on sentiment, along with margin calls and institutional selling that intensified market volatility. 

Heavy selling was witnessed in major index-heavy stocks such as Lucky Cement, United Bank, Mari Energies, MCB Bank, Engro Fertiliser and Bank Al Habib. Conversely, National Bank provided some support to the index following the announcement of its strong quarterly financial results, which helped limit further downside. 

Looking ahead, investor sentiment is expected to remain cautious amid rollover week, as traders adjust their futures positions. Additionally, the ongoing corporate earnings season will continue to play a key role in shaping short-term market direction, with investors closely monitoring company results for signs of sectoral strength, KTrade indicated.

Overall trading volume decreased to 951.8million shares versus Tuesday’s tally of 1billion. Traded volume stood at Rs41.3billion. Shares of 478 companies were traded. Of these, 123 closed higher, 314 fell and 41 remained unchanged. K-Electric was the volume leader with trading in 93million shares, rising Rs0.17 to close at Rs5.44.