The Pakistan Stock Exchange (PSX) witnessed a sharp decline on Wednesday, breaking its two-day winning streak as the benchmark KSE-100 index dropped by 755 points, closing at 116,020.11. The fall was driven by profit-taking at higher levels and late-session selling, especially in large-cap exploration and production (E&P) stocks.
Market Opens Strong But Fails to Hold Gains
The trading day began on a positive note, with the KSE-100 index surging 648 points in early trade and reaching an intraday high of 117,424. However, bearish sentiment took over in the second half, wiping out early gains and pushing the market into negative territory.
According to analysts, the index failed to recover the “Monday Tariff Gap”, reinforcing a bearish near-term outlook. This was further compounded by external pressures and weak domestic indicators.
Key Drivers Behind Market Decline
- Profit-taking in high-performing stocks
- Concerns over US-China trade war reigniting global uncertainty
- 3.5% contraction in large-scale manufacturing (LSM) in February 2025
- Volatility in the rupee and decline in cement sales
- Selling pressure in major E&P stocks like Mari Petroleum (-2.51%), Pakistan Petroleum (-1.75%), and PSO (-2.43%)
Ahsan Mehanti of Arif Habib Corporation noted that multiple economic headwinds, including weak macro data and global trade tensions, triggered the sell-off.
Top Gainers and Key Highlights
Despite the overall downturn, some stocks showed resilience:
- UBL (+0.87%): Posted EPS of Rs29.34 for 1QCY25, marking a 125% YoY growth, along with a Rs11 dividend and a two-for-one stock split. The bank also reported a 200% YoY surge in net interest income and a Rs1.6 billion provisioning reversal.
- Engro Fertilisers (+1.28%)
- MCB Bank (+0.94%)
Trading Activity and Volume Leaders
- Total volume: 481.8 million shares
- Total value traded: Rs38.5 billion
- Top volume leaders:
- Cnergyico PK: 35.6 million shares (closed at Rs8.51, down Rs0.02)
- Bank of Punjab: 25.5 million shares (closed at Rs11.11, down Rs0.06)
- Fauji Foods: 25.3 million shares (closed at Rs15.91, up Rs0.10)
Out of 451 actively traded companies, 140 advanced, 260 declined, and 51 remained unchanged. Foreign investors were net buyers, purchasing Rs222 million worth of shares, according to the NCCPL.
Analyst Insights: Outlook Remains Cautious
Analysts at Topline Securities described the session as volatile, with a mix of optimism and caution. The market’s inability to sustain momentum highlights the ongoing investor uncertainty, influenced by external factors like US-China trade tensions.
According to JS Global, despite initial momentum, heavy profit-taking and sector-specific pressure pulled the market down. However, they noted that banks and export-driven sectors may continue to attract investor interest due to strong liquidity and improving external accounts.
Conclusion
The PSX’s decline reflects a cautious investor approach amid macroeconomic challenges, global trade uncertainty, and profit-booking in high-performing sectors. While select stocks like UBL and Engro Fertilisers offered some optimism, the overall market trend signals a bearish bias in the short term.
