Pakistan Stock Exchange Dips Despite $1.2bn IMF Agreement Boost

KARACHI: The Pakistan Stock Exchange (PSX) experienced a downturn on Thursday, following an initial surge fueled by a staff-level agreement (SLA) between Pakistan and the International Monetary Fund (IMF). Despite the promise of a $1.2 billion lifeline, the market’s optimism was short-lived amid ongoing regional and political uncertainties.

Initially, the PSX index soared by approximately 906 points, reflecting positive investor sentiment after the successful completion of the IMF’s 4th Extended Fund Facility and 3rd Review. However, as the session progressed, profit-taking set in, leading to a decline of 1,138 points, or 0.68%, closing at 167,442. The index fluctuated between 167,450 and 169,487 during the trading day, indicating significant volatility.

Ali Najib, Deputy Head of Trading at Arif Habib Ltd, noted that while the market opened positively, concerns over rising oil prices—exacerbated by recent attacks on oil tankers—triggered fears of energy supply disruptions and increased import costs. These factors, combined with persistent inflationary pressures, contributed to the market’s retreat.

Looking ahead, analysts suggest that the PSX may continue to face challenges as investors remain cautious amid fluctuating global oil prices and domestic economic pressures. Upcoming economic indicators and further developments from the IMF will be closely monitored as stakeholders seek clarity on Pakistan’s financial stability.