Karachi: Thursday saw the PSX open in the red as the KSE-100 benchmark on Thursday fell in early trades by over 2,500 points, influenced by increased geopolitical tensions and growing uncertainties in global markets. By around 11:00 AM, the index had bounced back slightly but was still down 786 points at 116,439.83 compared with the previous close of 117,226.15.
The steep declines were precipitated by India's cancellation of the Indus Waters Treaty, established since 1960 and suspended thereafter until the present time, in respect of which concerns were raised following the terror attack in Pahalgam, IIOJK, whereby 26 tourists were killed. As accusations and thus a wave of fear-inducing imputations flew from India towards Pakistan, so-called" investors worked overtime".
The markets were apparently spooked by growing geopolitical uncertainty and volatility in global markets, selling off in droves on the PSX," reported market analysts. Mixed information from the Trump administration, which has wavered back and forth on tariff policies and pressure on the US Federal Reserve, only exacerbates this already muddled outlook for global economics in the eyes of investors.
The latest news had seemed to indicate that the US would reduce tariffs on goods from China. However, following that, Treasury Secretary Scott Bessent confirmed that the U.S. would not take such an action unilaterally, adding to this confusion for investors.
The combination of local instability and global economic noise has shaken investor sentiment and created a risk-off environment in the market space. Analysts suggest that unless there is clarity soon politically, the PSX may continue to remain under pressure, while volatility may be witnessed in the ensuing trading sessions.
[Source Credit: Business Recorder]
