Shares at PSX nosedive amidst political uncertainty, delay in IMF review

Shares at the Pakistan Stock Exchange (PSX) fell sharply on Tuesday, with analysts attributing the sell-off to political uncertainty and delay in the completion of the International Monetary Fund’s (IMF) ninth review. The benchmark KSE-100 index plunged by 1378.54 points, or 3.47 per cent, to close at 38,342.21 points, its lowest level since July 27, 2020. Today’s sell-off marked the highest one-day slide since June 24, 2022, according to Arif Habib Limited. The index reached an intraday low of 38,287.81 points, down 1,432.94 points, or 3.74pc, at 3:23pm. First National Equities Limited Director Amir Shehzad said the market was already under pressure because of political uncertainty after the dissolution of the Punjab Assembly. He noted that Khyber Pakhtunkhwa Chief Minister Mahmood Khan is also expected to send a summary to the governor to dissolve the provincial assembly today. However, the market came under added pressure on signs that the government’s negotiations with the IMF may be delayed, he added. Arif Habib Corporation’s Ahsan Mehanti said the index fell on reports of the IMF’s harsh conditions, including an end to managing the exchange rate, increase in gas prices and resolution of the circular debt issue. In addition, reports of an increase in the benchmark interest rate at the central bank’s upcoming Monetary Policy Committee meeting also weighed down sentiment, he said.