New Delhi – The Pakistan Stock Exchange (PSX) witnessed a sharp decline today, a direct response to the escalating geopolitical tensions following the recent terrorist attack in Pahalgam, India. In the wake of the attack, India has implemented a series of strong retaliatory measures against Pakistan, including the suspension of the Indus Water Treaty, the closure of the Wagah-Attari border, and the revocation of visa exemptions for Pakistani citizens under the SAARC framework. These decisions have sent shockwaves through Pakistan’s financial markets.
PSX Opens with Major Losses
As trading began on Thursday, the PSX experienced a dramatic sell-off. The KSE-100 index plunged by 2,485.85 points, marking a 2.12% drop in early trading. Within the first five minutes of market opening, the index had already dropped to 114,740.29 points, reflecting a rapid and widespread investor retreat amid fears of heightened regional instability.
Continued Market Slide and Investor Anxiety
This sharp fall follows a similar trend from Wednesday, where the market had already begun to show signs of strain. Several factors have combined to shake investor confidence in Pakistan’s economic outlook:
- The International Monetary Fund (IMF) recently revised Pakistan’s projected GDP growth rate down to 2.6%, signaling slower economic momentum.
- Fitch Ratings has also raised red flags over Pakistan’s financial stability, citing the declining Pakistani rupee, political unrest, and security challenges in Kashmir as key concerns.
These developments have significantly impacted investor sentiment, with many pulling out funds in anticipation of further economic turbulence.
Outlook
With geopolitical tensions intensifying and economic warnings from international agencies, Pakistan’s stock market is likely to remain volatile in the near term. Analysts believe that unless political stability is restored and cross-border tensions are de-escalated, financial markets will continue to bear the brunt.
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