Daily Times

The benchmark KSE-100 Index dropped almost 1,100 points in intraday trade on Wednesday, as investors were put on edge by uncertainties surrounding the restart of the International Monetary Fund (IMF) programme and poor economic data.

It was only two days ago that the benchmark KSE-100 Index had its largest percentage decline since 2022, with a decline of 3.23 percent.

The KSE-100 index finished with a loss of 641.21 points, or 1.47 percent, due to last-minute value buying, but it recovered part of its losses. The index ended the day at 42,863.15, having hit an intra-day low of 42,394.32 at one point throughout the day. Earlier, the market had fallen by 1,110 points as a result of the IMF program’s potential rebirth and a slew of bad economic news.

An increase in investors’ concerns about Pakistan’s balance of payments crisis because of the country’s growing current account deficit and anticipation of higher inflation and interest rates in the upcoming monetary policy statement triggered the selling. Concerns were exacerbated by the country’s continued political turmoil and a broad sense of economic policy uncertainty. Later on, investors started looking for bargains, which helped the market rebound.

Because there are no good indicators in the market, the pressure on the economy is being reflected in the markets, and it will continue to be reflected in the markets until clarity is obtained following the IMF meeting on May 18. The market is currently experiencing a period of uncertainty. Meanwhile, the market expects another rate hike at the next Monetary Policy Committee (MPC) meeting on May 23, which will be held on May 23. Following the conclusion of IMF negotiations, it is expected that different subsidies will be reversed.