PSX closes in red over deteriorating political situation, index down by over 1,350 points

KARACHI: The Pakistan Stock Exchange (PSX) on Tuesday shed 1,889 point and closed at 43,899 points after shedding around three per cent.

During the day’s trading session, investors traded around 191 million shares of 392 companies, with a total trading volume of more than Rs9 billion.

CEO Shajer Capital Rehan Atiq said the market fell due to the deteriorating economic and political situation. He added that economic fundamentals are concerning even though political noise is more prominent.

Atiq further said falling foreign exchange reserves and the rising current account deficit is a concern, among local and foreign investors.

He said that foreign investors are closely watching the dollar to rupee parity.

“Many foreign investors think the rupee would take a hit and are therefore keeping distance from taking new positions,” said Atiq, adding that the deteriorating political situation is like “icing on the cake”. 

When inquired, Zeeshan Afzal, Head of Research at Insight Securities, claimed it was a result of the political uncertainty, adding that investors were keeping a very close eye on political developments.

When asked if the result season had played a role in the slip, Afzal told Geo.tv that while the results were not encouraging interest, they were in line with market expectations. He ruled out the bearish trend to be caused due to anaemic results.

Afzal added that economic fundamentals were also not to blame because he claimed everyone was aware of depleting forex reserves and while the current account deficit would make donors consider our capacity to meet financial obligations; it wasn't to blame for the negative trend.

It is all because of political turmoil and uncertainty, Afzal concluded.