Bears take hold of PSX as shares plunge over 900 points on ‘delay in budget’

Published June 4, 2024
Downward trajectory detected at the Pakistan Stock Exchange (PSX) on Tuesday— screenshot of the PSX data portal.
Downward trajectory detected at the Pakistan Stock Exchange (PSX) on Tuesday— screenshot of the PSX data portal.

Bears took over at the Pakistan Stock Exchange (PSX) as shares plunged more than 900 points on Tuesday, which analysts attributed to the delay in budget.

The benchmark KSE-100 index plunged 834.24 points, or 1.1 per cent, to stand at 74,741.01 at 3:09pm from the previous close of 75,575.25 points. Finally, the index closed at 74,666.65, down by 908.60 points or 1.2pc, from the previous close.

Raza Jafri, chief executive of EFG Hermes Pakistan, said, “Buyers seem to be shying away as they await the federal budget, as this could impact monetary policy setting.

“The market has thus come off on relatively thin volumes,” he noted.

Mohammed Sohail, chief executive of Topline Securities, credited the bearish momentum to the delay in budget and selling pressure by players.

Awais Ashraf, director research at Akseer Research, attributed the downward trajectory to “increased external financing needs over the next two months are prompting worries about the potential for monetary easing by the State Bank of Pakistan (SBP) and the stability of the exchange rate, which is already under scrutiny due to uncertainties surrounding the budget and the country’s entry into a new IMF programme.”

He also noted that “selling pressure was widespread, particularly impacting banks, fertilizer, exploration and production, and technology firms”.

Shahab Farooq, director research at Next Capital Limited, said, “Increased political uncertainties are taking toll on the equities market despite significantly lower than expected inflation reading for May 2024.”

Follow Dawn Business on Twitter, LinkedIn, Instagram and Facebook for insights on business, finance and tech from Pakistan and across the world.

Opinion

Editorial

Closed doors
Updated 08 Jan, 2025

Closed doors

The nation’s fate has been decided through secret deals for too long, with the result that the citizenry has become increasingly alienated from the state.
Debt burden
08 Jan, 2025

Debt burden

THE federal government’s total debt stock soared by above 11pc year-over-year to Rs70.4tr at the end of November,...
GB power crisis
08 Jan, 2025

GB power crisis

MASS protests are not a novelty in Pakistan, and when the state refuses to listen through the available channels —...
Fragile peace
Updated 07 Jan, 2025

Fragile peace

Those who have lost loved ones, as well as those whose property has been destroyed in the clashes, must get justice.
Captive power cut
07 Jan, 2025

Captive power cut

THE IMF’s refusal to relax its demand for discontinuation of massively subsidised gas supplies to mostly...
National embarrassment
Updated 07 Jan, 2025

National embarrassment

The global eradication of polio is within reach and Pakistan has no excuse to remain an outlier.