KARACHI: The Pakistan Stock Exchange (PSX) ended its nine-session winning streak on Thursday, with profit-taking dominating the session amid heightened concerns over inflation, the economic fallout of widespread floods, and expectations of no immediate change in interest rates.
Market analysts noted that disruptions in supply chains caused by flood damage are expected to further drive inflationary pressures and dent industrial activity in the coming weeks. This outlook weighed heavily on investor sentiment, leading to cautious trading and a reversal from the strong bullish momentum seen earlier.
According to Ali Najib, Deputy Head of Trading at Arif Habib Ltd, the PSX had “finally hit the pause button” after a powerful rally of more than 10,000 points, or nearly 7 percent, from its late August lows. The latest session demonstrated that investors, having enjoyed significant gains, were now more focused on capital preservation amid macroeconomic uncertainty.
The day’s trading began on a strong note, with the KSE-100 index briefly hitting a fresh intraday all-time high of 157,817 points, up 796 points. However, early optimism was short-lived, and heavy profit-taking set in, dragging the index to an intraday low of 156,104 points before closing near that level.
Data released by Topline Securities Ltd showed that the benchmark index closed at 156,141 points, down 880 points or 0.56 percent. The market remained volatile throughout the day, swinging between gains and losses. While positive contributions came from companies such as Meezan Bank, Interloop Ltd, and Kohinoor Textile Mills, which collectively added 152 points, these gains were overshadowed by sharp declines in major players including Engro Corporation, Pakistan Petroleum Ltd, Mari Petroleum, Engro Fertilisers, and Fauji Fertiliser. Together, these heavyweights wiped out 540 points from the KSE-100.
Despite the downturn, investor participation remained strong. Traded volume surged by 28.47 percent to 1.27 billion shares, while traded value rose by 4.77 percent to Rs50.2 billion. Agha Steel Industries led the volume charts, with 113 million shares traded, signaling that overall market activity continues to remain robust despite the pullback.
The session’s losses also came against the backdrop of critical macroeconomic developments. Pakistan’s second review under the International Monetary Fund’s Extended Fund Facility (EFF) is scheduled between September 25 and October 8, with a $1 billion tranche expected upon successful completion. The Ministry of Finance has labeled this review as “critical” for unlocking much-needed external inflows, restoring investor confidence, and stabilizing the economy.
In parallel, the launch of Pakistan’s debut $250 million Panda Bond, denominated in Chinese Renminbi, is expected to support funding diversification and deepen the country’s financial linkages with China. The initiative is viewed as a key milestone in broadening Pakistan’s international financing channels at a time of growing external financing needs.
Looking ahead, analysts expect the PSX to remain volatile, with potential consolidation in the 155,000 to 157,000 range. Should selling pressure intensify, the 154,000 level is likely to emerge as a significant technical support for the KSE-100 index. Market observers caution that while fundamentals remain mixed, broader macroeconomic uncertainty tied to inflation, flood recovery costs, and IMF conditions will continue to guide sentiment in the near term.
Follow the PakBanker Whatsapp Channel for updated across Pakistan’s banking ecosystem.