Karachi, January 8, 2025 – The KSE-100 Index of the Pakistan Stock Exchange (PSX) witnessed a massive decline of 1,904 points on Wednesday, closing at 114,148 points compared to the previous day’s 116,052 points. The sharp drop followed Prime Minister Shehbaz Sharif’s visit to the stock market, during which no immediate relief measures were announced, leaving investors disappointed.
Prime Minister Shehbaz Sharif visited the PSX to commend the stock market’s management and stakeholders for achieving the historic milestone of 100,000 points. However, expectations among investors for the announcement of supportive measures remained unmet. This lack of decisive action led to significant selling pressure, causing the KSE-100 Index to reverse gains made earlier in the day.
In his address, PM Shehbaz acknowledged the challenges plaguing the business environment, including high tax slabs and elevated policy rates. While assuring that these issues would be addressed as the economy stabilizes, he emphasized the necessity of adhering to the ongoing International Monetary Fund (IMF) program. “We understand the tax burdens are prohibitive,” he remarked. “However, our commitments to the IMF are crucial at this juncture. We aspire to part ways with the IMF in the future, but only once we’ve achieved economic resilience.”
The market initially showed optimism prior to the prime minister’s visit, with the KSE-100 Index gaining over 1,400 points during the morning session. By 10:40 a.m., the index had surged to 117,561 points, reflecting a 1.3% increase. This uptick was driven by buying interest across key sectors such as automobile assemblers, cement, chemicals, commercial banks, fertilizer, and oil and gas exploration companies. Major contributors to the green momentum included index-heavyweights such as ENGRO, MCB, OGDC, and PPL.
Despite this early optimism, the absence of tangible announcements led to a rapid reversal in sentiment. Analysts noted that investor confidence, while initially buoyed by hopes of government intervention, faltered when no immediate relief materialized.
On Tuesday, the PSX had already experienced a modest decline, with the KSE-100 Index shedding 202 points to close at 116,052. Selling pressure persisted as investors offloaded shares to capitalize on available margins.
While PM Shehbaz’s assurances of addressing economic challenges provided a degree of long-term optimism, the immediate market reaction underscored the pressing need for actionable measures to sustain investor confidence. The KSE-100 Index’s performance remains a critical barometer of economic sentiment, reflecting the delicate balance between policy commitments and market expectations.
