Karachi, November 26, 2024 – The benchmark KSE-100 index of the Pakistan Stock Exchange (PSX) dropped sharply by 1,706 points, or 1.74%, during midday trading on Tuesday, reflecting heightened political unrest in the country.
At 12:50 PM PST, the index was trading at 96,374 points, down from Monday’s historic close of 98,080 points. The sharp decline followed reports that the government had deployed the army to manage a violent protest in Islamabad led by Pakistan Tehreek-i-Insaf (PTI). This development triggered widespread investor concern, leading to significant sell-offs across the board.
The market’s drop comes after a wave of optimism as the KSE-100 index had recently reached an all-time high, with analysts anticipating the potential to surpass the 100,000-point milestone. However, the intensifying political instability has cast doubt on the market’s ability to maintain its upward momentum.
Despite the setback, analysts highlighted the KSE-100 index’s underlying resilience, which they attribute to robust economic indicators such as stable exports, healthy remittance inflows, and the government’s focus on market-friendly reforms. Nevertheless, they warned that prolonged political instability could undermine investor confidence and prolong market volatility.
“The index’s performance reflects confidence in economic fundamentals, but the current political turmoil has introduced significant uncertainty,” said a senior market analyst. “Until the situation stabilizes, fluctuations in the market are likely to persist.”
While the recent decline has raised concerns, some market watchers remain optimistic about the market’s recovery prospects. They believe that once political tensions subside, the index could regain its upward momentum, buoyed by Pakistan’s positive economic outlook. Past instances of resilience during periods of political instability suggest that the market has the potential to recover quickly.
Experts also noted that the KSE-100 index’s trajectory will hinge on broader macroeconomic factors, including inflation control, fiscal discipline, global commodity trends, and geopolitical developments. If political calm is restored, the index could resume its climb toward new milestones.
The KSE-100’s performance in the coming days will serve as a critical barometer of investor sentiment and the market’s capacity to navigate the current political uncertainties.
