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KSE-100 nosedives over 1,700 points as economic turmoil dents investors’ confidence

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1 year ago

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  • PSX’s benchark index continues to fall.
  • Investors jittery over decline in rupee value.
  • PKR trades at 306.05 against USD in interbank.

KARACHI: Bears maintained a firm grip on the Pakistan Stock Exchange (PSX) on Thursday as the benchmark index tanked nearly 4% amid fears over the worsening economic condition of the country.

Investors reacted with panic to the rising rupee-dollar parity, opting to offload shares on fears of a looming economic turmoil.

The KSE-100 index plummeted from the moment trading began and dived more than 1,700 points to fall below the 45,000 mark. Weak investor sentiment is restricting the index from entering positive territory.

The PSX was at 44,475.06 after falling 1,769.49 points or 3.83% at 02:54pm compared to Wednesday’s close of 46,244.55 points.

KSE-100 nosedives over 1,700 points as economic turmoil dents investors’ confidence

Speaking to Geo.tv, Intermarket Securities’ Head of Equity Raza Jafri said that the KSE-100 is facing severe selling pressure as there is a lack of confidence emanating from the weak economy.

“In particular, investors are taking their cues from the depreciating rupee especially as the next review of the International Monetary Fund (IMF) is not due for a few months and there is a little concrete colour on planned investment from the GCC. Value buyers may return if the dip extends as the index is down 8% from its recent high but meaningful valuation rerating needs clarity on politics and the economy return.”

Echoing the sentiments, Capital market expert Saad Ali stated that PSX remains under pressure as the incessant rupee slide has worsened the outlook for inflation ahead of the next MPC in September, in which the central bank can resume raising interest rates.

Ali noted that the financial market is also nervous about the public protests over power tariff hikes and if the interim govt resorts to populist measures to appease the public, it will jeopardise talks with the IMF.

“On a positive note, today MSCI rebalancing is underway, due to which Pakistan is likely to see foreign inflows. But it is not enough to improve market sentiment.”

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Business

Irfan Siddiqui meets with the PM and informs him about the Senate performance of the parliamentary party.

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2 days ago

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The head of the Senate’s Foreign Affairs Standing Committee and the PML-N’s parliamentary leader paid Prime Minister Muhammad Shehbaz Sharif a visit in Islamabad.

Senator Irfan Siddiqui gave the Prime Minister an update on the Parliamentary Party’s Senate performance.

Additionally, Senator Irfan Siddiqui gave the Prime Minister an update on the Senate Standing Committee on Foreign Affairs’ performance.

He complimented the Prime Minister on his outstanding efforts to bring Pakistan’s economy back on track and meet its economic objectives.

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Business

SIFC Increases Direct Foreign Investment: Investment in the Energy Sector Rises by 120%

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The Special Investment Facilitation Council is intended to help Pakistan’s energy sector attract $585.6 million in direct foreign investment in 2024–2025. The amount invested at the same time previous year was $266.3 million.

This is a notable 120% rise, mostly due to investments in gas exploration, oil, and power. Such expansion indicates heightened investor confidence and emphasizes the development potential in important areas.

The State Bank reports that foreign investment in other vital industries has increased by 48% to $771 million.

This advancement is a blatant testament to SIFC’s efficient investment procedure and quick project execution.

The purpose of the Special Investment Facilitation Council is to establish Pakistan as an investment hub by aggressively promoting regional trade and investment in the energy sector and other critical industries.

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Business

Discos report losses of Rs239 billion.

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When compared to the same period last year, the data indicates that discos have decreased their losses in the first quarter of the current fiscal year.

The distribution businesses recorded losses of Rs239 billion in the first three months of the current fiscal year, a substantial decrease from the Rs308 billion losses sustained during the same period the previous year.

Additionally, the distribution businesses’ rate of recovery has improved. It has increased to 91% in the first quarter of this year from 84% in the same period last year, indicating success in revenue collection.

Regarding circular debt, the Power division observed a notable change. Last year, between July and October, the circular debt grew by Rs301 billion. Nonetheless, this year’s first four months saw a relatively modest increase in circular debt, totaling about Rs11 billion.

These enhancements show promising developments in the electricity sector’s financial health in Pakistan, where initiatives are being made to accelerate recovery rates and slow the expansion of circular debt.

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