The Pakistan Stock Exchange experienced a sharp reversal on Tuesday as the benchmark KSE-100 index faced heavy selling pressure, ending the session deep in negative territory after two consecutive days of upward momentum. Market activity reflected widespread profit-taking as investors turned cautious amid global market fluctuations, domestic fiscal pressures, and mixed macroeconomic cues.
The trading session opened on a positive trajectory but quickly lost direction as sell-side momentum built across key sectors. The KSE-100 index oscillated between an intraday high of 163,384.95 points and a low of 161,159.26 points, demonstrating intraday volatility and investor hesitation after recent gains. By close, the index settled at 161,281.77 points, marking a decline of 1,521.39 points or 0.93% from the previous session’s close.
Market insights indicated that the pullback followed a strong two-day rally fueled by optimism linked to improved geopolitical sentiment and earlier foreign inflows. However, with valuations elevated across several index-heavy counters, traders moved to secure near-term gains. According to market commentary, blue-chip scrips including ENGRO, MARI, BAHL, MCB, and TRG exerted significant downward pressure, collectively contributing 543 points to the index decline.
Domestic fiscal developments also influenced investor behavior. Federal Board of Revenue (FBR) Chairman Rashid Mahmood Langrial stated that no new taxation contingency plan would be introduced despite a revenue shortfall of Rs 275 billion recorded during the July to October 2025-26 period. The stance, viewed as a signal of fiscal tightening constraints, added to investor caution during the session.
The downturn came after a strong start to the week, when the benchmark index rose by 1,171.42 points on Monday amid supportive regional sentiment and optimism following a reported Pakistan-Afghanistan ceasefire. The rebound momentum did not hold as global market cues turned mixed on Tuesday.
Asian markets reflected a split trend, with Japan’s Nikkei and Taiwan’s TAIEX achieving fresh record highs driven by tech sector rallies, while South Korea’s KOSPI and other regional markets saw declines. US markets also posted weakness in futures trade following unclear signals on the Federal Reserve’s interest rate path ahead of the December policy announcement. Meanwhile, Australia’s benchmark index drifted lower ahead of its monetary policy decision.
Currency movement showed marginal improvement for the Pakistani rupee, which appreciated slightly by Re0.03 to close at 280.87 in the inter-bank market. Trading activity on the exchange slowed, with volume declining to 899.41 million shares from 949.36 million recorded in the previous session. Total traded value also decreased to Rs37.31 billion from Rs47.58 billion. WorldCall Telecom, Telecard Limited, and K-Electric Limited led trading volumes, reflecting continued interest in high-turnover, retail-driven counters. Of the 479 actively traded companies, 133 closed higher, 314 declined, and 32 remained unchanged.
While analysts note that the correction reflects healthy profit realization after recent rallies, market participants are expected to monitor global monetary developments, domestic revenue measures, and geopolitical signals closely ahead of further movement.
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