Karachi, May 8, 2025 — The KSE-100 index, the benchmark of the Pakistan Stock Exchange (PSX), witnessed its worst-ever single-day decline on Thursday, crashing by an unprecedented 6,482 points amid escalating tensions with India.
The index closed at 103,527 points, sharply down from the previous day’s closing level of 110,009 points, marking a loss of 5.89%.
According to analysts at Topline Securities, the KSE-100 index’s fall is the steepest in a single trading session in Pakistan’s stock market history. The plunge was triggered by overnight reports that India had launched multiple drone attacks across Pakistani territory, sparking fears of a broader military conflict.
Initially, the PSX opened on a positive note, with the index surging by 1,900 points in early trading. Investors appeared hopeful that diplomatic efforts might ease tensions. However, optimism quickly vanished when credible reports confirmed cross-border aggression. Panic selling ensued, with investors rushing to offload equities, causing the KSE-100 index to nosedive.
By 12:37 PM, the index was down 6,949 points, trading at 103,060 — reflecting a decline of over 6.32% intraday. The freefall triggered a temporary halt in trading as the PSX hit its lower circuit breaker, underscoring the intensity of investor anxiety.
Adding to market volatility is the looming International Monetary Fund (IMF) Executive Board meeting scheduled for May 9. Pakistan is awaiting the approval of a critical $1.3 billion disbursement under the Extended Fund Facility (EFF). The meeting will also review Pakistan’s request for performance criteria waivers and additional financing under the Resilience and Sustainability Facility (RSF), which could potentially increase the total aid package to nearly $2 billion.
Just two days earlier, on Tuesday, the KSE-100 index had already posted a sharp 3.13% drop — a 3,559-point fall — due to growing regional instability. The cumulative losses over the week have severely shaken investor confidence.
With political tensions soaring and economic uncertainty deepening, market analysts caution that the outlook for the KSE-100 index remains grim in the short term. All eyes are now on diplomatic channels and the IMF meeting as possible sources of relief.