The Pakistan Stock Exchange (PSX) decreased by more than 1,300 points on Wednesday, one day after the index registered a slight recovery after the agitation of the global market in response to the fears that the commercial war between the United States and China would increase.
The KSE-100 reference index was submerged at 2,640.95 points, or 2.29 percent, to reach 112,891.48 at 10:49 am from the previous closure of 115,532.43. At 2:56 pm, 114,370.23, or 1.01pc below the last closure was recovered.
Finally, the index decreased by 1,379.28 points, or 1.19PC, to close to 114,153.15.
The decrease occurs when the additional tariffs of the United States on Chinese imports reached 104 % today, since Washington doubles into the planned action after Beijing promised a “fight until the end” in the taxes.
Awais Ashraf, research director of AKD Securities, said that the increase in American tariffs on China to 104PC has “increased recession risks due to a slowdown in global growth, cushioning the feeling of investors in the PSX.”
“However, the lowest prices of basic products, especially oil, and a possible competitive advantage of new tariffs could positively affect our external account,” Ashraf said.
Yousuf M. Farooq, research director of Chase Securities, said that the local stock exchange was reduced today “in line with global markets.”
“A decrease in oil prices this morning has led to weakness in oil -related actions. However, we believe that the fall in oil prices will compensate more than any downward risk for exports,” he said.
“The market has currently dropped 5.5 percent since its historical maximum. That said, the capital market of Pakistan has remained relatively resistant, since exports constitute a small portion of GDP,” Farooq said.
He added that the historical data of the financial crisis of 2008 and the Covid-19 pandemic show that remittances remained stable during those periods, which is a good omen for the external stability of the account.
Farooq pointed out: “India announced a cut of interest rates this morning, and with the expectations of inflation in Pakistan now significantly lower, driven by the global decrease in the prices of basic products, we could see a locally also cutting tariffs.”
He observed that the lowest oil prices also provide the government to increase income through a higher oil development tax (PDL) if necessary.
Today’s fall follows the Bloodbath on Monday at the PSX when the shares fell by 3,882 points in the middle of the growing fears of a global recession and reprisals of the main commercial and Chinese partners of the United States.
That day, the KSE-100 index witnessed a record drop of one day (in terms of points) of 8,687.68 points, before partially recovering some losses in the late value hunt, after a media stop at halfway.
Yesterday, Ali Najib, Chief of Sales of Insight Securities, emphasized the need to observe market behavior after April 9, when world commercial tariffs will be implemented and will evaluate their repercussions in affected countries.
He said that reciprocal tariffs could trigger market volatility, with the feeling of investors that become cautious, adding that export -based actions could decrease, while assets with safe waters as gold could win.
Commercial tensions with countries that have large commercial volumes could cause reprisals, affecting global supply chains and profit prospects, which can lead to a short -term market setback.
