The Pakistan Stock Exchange (PSX) witnessed a sharp decline of 1,500 points in the KSE-100 index on Thursday, as investors reacted to rising tensions between Pakistan and India, fueling uncertainty in the market. The political instability prompted cautious trading, with investors refraining from making significant moves amid concerns over potential shifts in diplomacy and economic conditions. However, the market received some relief from strong profits reported by key companies, offering partial support.
Experts suggest that the direction of the market will largely depend on the evolving situation between Pakistan and India, along with the anticipated monetary policy announcement from the State Bank of Pakistan, which could influence investor confidence. Despite the market dip, positive economic indicators, such as record-low inflation and a current account surplus, continue to offer hope for stability.
Financial analysts also forecast a modest decline in the Pakistani rupee, projecting an exchange rate of around Rs283 per US dollar in the near future. While this drop is expected to be gradual, it remains a key factor for investors to monitor in the coming weeks.