PSX edges lower amid interest rate concern

KSE-100 index drops 579 points as investors weigh developments affecting macroeconomic direction

In a session full of concern and optimism, the Pakistan Stock Exchange (PSX) witnessed a modest decline of 579.17 points, or 0.31% on Monday as judicious investors anxiously waited for a positive outcome from the State Bank of Pakistan’s (SBP) Monetary Policy Committee (MPC) meeting.

In the morning, Trading took a bullish start with the benchmark KSE-100 crossing the 191,032.73 level. However, the activity turned range-bound with the index touching an intra-day low of 188,268.38. Selling pressure near higher levels reflected restrained investor participation and a lack of conviction ahead of policy clarity.

Sentiment remained subdued rest of the day as participants closely monitored signals from the central bank, particularly regarding the interest rate decision and future monetary direction. Additionally, lingering concerns over the persistent geopolitical concerns over the Iran–US dynamic, prompted investors to adopt a more defensive, risk-averse stance.

Consequently, the market closed modestly lower, posting a decline of 579.17 points, or 0.31%, at 188,587.66 with investors preferring to stay on the sidelines until greater clarity emergeD from the monetary policy outcome.

KTrade Securities equity trader Ahmed Sheraz observed that the market largely remained range-bound as investors stayed cautious ahead of the MPC meeting. While expectations were tilted towards a 50–75basis points rate cut, uncertainty over the final decision kept risk appetite in check.

Sentiment was further dampened by rising geopolitical tensions, particularly surrounding the Iran–US situation, which encouraged a broader risk-off approach. Adding to the pressure, the ongoing futures rollover activity also weighed on the market, he noted.

Stock-specific activity remained selective. Sazgar Engineering touched its upper limit over recent TANK 500 bookings while Systems Limited Millat Tractors, Javedan Corporation, Fauji Foods, and United Bank closed higher.

On the flip side, Meezan Bank, Engro Holdings, Pioneer Cement, Fatima fertiliser, Lucky Cement, and Hub Power emerged as key laggards. Sector-wise, automobiles and technology showed relative resilience, whereas oil & gas, cement, and commercial banks stayed under pressure.

Looking ahead, Sheraz expected the market direction to remain sensitive to developments on the geopolitical front and the outcome of the MPC meeting, with near-term sentiment likely to stay cautious.

Overall trading volume decreased to 870.4 million versus previous close of 877.5m.

The values of traded shares stood at Rs57.1 billion. Shares of 487 companies were traded. Of these, 143 closed higher, 298 fell and 46 remained unchanged. K-Electric topped the volume chart with trading in 172,9m shares, rising Rs0.23 to close at Rs6.97.