PSX nosedives by over 800 points amid political uncertainty

The Pakistan Stock Exchange (PSX) on Tuesday plunged by over 800 points during intra-day trade amid uncertainty on the political front.

At 11:59am, the benchmark KSE-100 Index dropped by 742 points, or 1.81%, to settle at 40,228 points.

However, a few minutes later the drop crossed the 800 mark. The market was hovering at 40,164 points down by 1.97%.

Speaking to Geo.tv, AA Commodities Director Adnan Agar said the stock market is reacting to all “bad political news”.

“Players are looking for political stability before assuming fresh positions in the market,” he said, adding that any positive news on political front or positive development regarding IMF programme will reinstate investors confidence.

Pakistan and the global lender have been holding discussion with Islamabad on the ninth review “productive”. However, differences between both the sides still persist making consensus harder to strike on a staff-level agreement for completion of the 9th review under $7 billion Extended Fund Facility (EFF).

Agar further highlighted that market players are also concerned about the future of the Shehbaz Sharif-led coalition government while taking into account the current political developments.

The federal government has been thrown off guard after Imran Khan announced that he will be dissolving the Punjab and Khyber Pakhtunkhwa assemblies this week.

“Moreover, constant depreciation of rupee against the US dollar is adding fuel to the downtrend,” he said, mentioning that the investors are unhappy with how Finance Minister Ishaq Dar is handling the rupee-dollar parity.