PSX witnesses its second-worst day of year

Bears tightened their grip on the Pakistan Stock Exchange (PSX) on Thursday as the benchmark index plummeted by around 1,250 points, or 2.7 per cent, driven by concerns about the country’s faltering economy, rumours of an impending interest rate hike, and the persistent depreciation of the rupee. It was the year’s second-biggest overnight decline in the benchmark KSE-100 index in terms of points, with the largest drop seen on Jan 17 when the index lost 1,379 points. Besides, the stock market fell 6.3pc (3,032 points) in August, logging the highest monthly decline since March 2020, just a month after the coronavirus pandemic struck the country, according to the research firm Arif Habib Ltd. The market’s fall in August also stood in stark contrast to a 16pc growth in July. However, the current index level — at 45,002 points — is still 8.6pc and 11.3pc higher than the beginning of this fiscal year and calendar year. Analysts noted that the market downturn could be attributed to investor worries regarding the consistent decline in the rupee’s value. Additionally, fears of increased electricity and gas prices, which investors fear could lead the State Bank of Pakistan to raise the interest rate in the upcoming monetary policy announcement on Sept 14, contributed to the decline.