Futures market sees sharp contraction

KARACHI: The futures market at the Pakistan Stock Exchange experienced one of its most subdued weeks in recent memory, even as the ready market recorded a robust surge in activity.

The turnover in the futures segment fell steeply. Average daily traded volume in futures contracts dropped by 65.8 percent, sliding from 537.72 million shares a week earlier to just 183.74 million shares. The contraction was equally evident in traded value, which plunged 60.6 percent to Rs11.76 billion, compared to Rs29.87 billion the previous week.

The most telling indicator of investor sentiment was the widening of the futures spread, which climbed from 6.28 percent to 12.98 percent—a dramatic increase of 670 basis points. This widening suggested that traders were demanding significantly higher premiums for holding leveraged positions, a sign of elevated uncertainty and wariness around short-term volatility.