The Pakistan Stock Exchange (PSX) experienced a significant downturn on Friday, with the KSE-100 index dropping over 600 points during intraday trading.
Closing at 73,206.74, the index fell by 656.19 points, a decline of 0.89% from the previous day’s close. Notably, the stocks plummeted to 71,961 points around 10 a.m., marking a steep decline.
Tahir Abbas, Head of Research at Arif Habib Limited (AHL), attributed the negative market sentiment to anticipated increases in capital gains tax and higher dividend income taxation proposed in the upcoming budget. “Investors hurried to offload their stocks ahead of the budget announcement, triggering panic in the market,” he explained.
This downturn follows a 356.51-point drop the previous day, driven by concerns over potential tax hikes in the FY25 budget and broader economic uncertainties.
Ahsan Mehanti, an analyst at Arif Habib Corp, commented, “Stocks declined amid fears of economic instability. Anticipations of a cautious approach from the State Bank of Pakistan and subdued growth prospects influenced investor sentiments negatively.”
Concerns about stringent conditions in the forthcoming International Monetary Fund (IMF) agreement, particularly regarding increased power tariffs and tax reforms in the Federal Budget FY25, also played a key role in the market’s bearish trend.
