On Monday, the Pakistan Stock Exchange (PSX) experienced a significant decline of over 500 points, which experts believe is due to political uncertainty. The benchmark KSE-100 index, according to the PSX website, was recorded at 47,648.33 points by 12:50pm. This reflects a decrease of 570.16 points or 1.18% compared to the previous close at 48,218.49 points.
Raza Jafri, the Head of Equity at Intermarket Securities, pointed out that despite some recent improvements, the country’s economy still remains vulnerable. This could be a contributing factor to the drop in stock prices.
Salman Naqvi, the head of research at Aba Ali Habib Securities, also attributes the losses to political uncertainty and the deteriorating law and order situation in Pakistan. Additionally, the lack of formal communication from authorities regarding the settlement of circular debt by the Oil and Gas Development Company (OGDC) adds to the uncertainty in the market. Naqvi notes that although the circular debt settlement is expected, the lack of clarity surrounding the matter creates doubt among investors.
The decline in stock prices reflects the cautious approach of investors, as they factor in various elements contributing to the uncertainty in the market. It is important for authorities to address these concerns and provide clarity to stabilize the stock market in Pakistan.