The bourse witnessed extreme volatility on Wednesday as geopolitical tensions with India triggered a panic sell-off in early trade, sending the benchmark KSE-100 Index plunging by over 6%.
However, the market managed to recoup a significant portion of the losses by midday, buoyed by investor optimism over the upcoming International Monetary Fund (IMF) board meeting.
The Pakistan Stock Exchange’s (PSX) benchmark KSE-100 Index settled at 110,009.02 points, down 3,559.48 points, or -3.13%, from the previous close of 113,568.50.
During the session, the index plunged to an intraday low of 107,007.68, reflecting a sharp drop of 6,560.82 points, or -5.78%. It recovered to a session high of 112,457.37, narrowing the loss to 1,111.13 points, or -0.98%.
“Pakistan Stock Exchange, after falling sharply by 6% at open, has recovered and is down 1% now. Many believe that after this, there will be no major escalation between the two neighbours and dust will eventually settle down,” said Mohammed Sohail, CEO of Topline Securities.
“Investors seem optimistic about the upcoming IMF board meeting, which will decide on the loan tranche for Pakistan,” he added.
The sharp early decline followed military strikes by India targeting areas in Punjab and Azad Kashmir. In response, Pakistan’s armed forces launched retaliatory operations, downing five Indian Air Force jets, including three Rafales, one Su-30MKI, and one MiG-29, as well as a combat drone.
