KARACHI – Trading at the Pakistan Stock Exchange (PSX) witnessed a downturn, with stocks plunging by over 900 points in intraday trade, signalling a bearish trend largely attributed to political uncertainties.
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The benchmark KSE-100 index had dropped by 984.38 points, or 1.61 percent, standing at 60,035.67, down from the previous day’s close of 61,020.05 points.
Thursday saw a dominance of bearish sentiment on the PSX floor, driven by the Pakistan Tehreek-e-Insaf’s (PTI) nomination of candidates for prime minister and Punjab chief minister, along with its outreach to various parties for coalition formation.
Additionally, the Pakistan Peoples Party’s (PPP) hesitance to join the cabinet of PML-N leader Shehbaz Sharif, despite endorsing him for prime minister, sparked strong reactions from the PML-N, further deepening political uncertainty, which in turn pressured the benchmark index, erasing gains from the previous session.
Mohammed Sohail, CEO of Topline Securities, cited the uncertainty surrounding coalition formation as the driving force behind the day’s bearish trend, prompting leveraged players to adjust their positions.
Awais Ashraf, Director of Research at Akseer Research, highlighted concerns over the formation of a potentially weak coalition government at the federal level, coupled with calls for protests from various parties, casting doubts on the implementation of necessary economic reforms for recovery. Consequently, state-owned entities faced selling pressure, contributing to the index’s decline.
Yousuf M Farooq, Director of Research at Chase Securities, pointed out that the Oil and Gas Development Company (OGDC) and Pakistan Petroleum Limited (PPL) witnessed selling pressure due to delays in resolving circular debt and ongoing political uncertainty.
