KSE-100 sheds nearly 400 points after SBP keeps policy rate unchanged

The Pakistan Stock Exchange (PSX) observed a volatile trading session on Tuesday, with the benchmark KSE-100 closing with a loss of nearly 400 points a day after the State Bank of Pakistan (SBP) decided to keep the policy rate unchanged at 10.5%.

The market kicked off on a brief positive note, with the benchmark KSE-100 Index hitting an intra-day high of 189,521.32. However, the rally, led by the banking sector, remained short-lived and selling pressure soon engulfed the bourse, pushing the market to an intra-day low of 187,538.23.

At close, the benchmark index settled at 188,202.85, a decrease of 384.81 points or 0.20%.

Gains from key heavyweight stocks, including FFC, MEBL, PPL, SYS, and BAFL, contributed a combined 949 points to the index. However, downward pressure from ENGROH, EFERT, and HUBC offset these gains, collectively eroding 637 points, brokerage house Topline Securities said.

Arif Habib Ltd’s Ali Najib said the market “lacked clear direction as investors continued to digest SBP’s surprise No-Change policy decision announced a day earlier, leading to cautious trading behavior across most sectors”.

The SBP, contrary to market expectations, on Monday decided to keep its benchmark policy rate unchanged at 10.5% in its first Monetary Policy Committee (MPC) meeting of 2026.

On Monday, the PSX witnessed a sharp bout of volatility as the benchmark index retreated from record territory, with investors resorting to profit-taking amid heightened caution ahead of the MPC meeting.

The KSE-100 Index declined by 579.17 points, or 0.31%, to close at 188,587.66.

Internationally, Asian shares advanced on Tuesday as investors hoped for the best from a barrage of US mega-cap earnings, though uncertainty caused by President Donald Trump’s latest tariff moves on South Korea limited broader gains while boosting gold and silver.

Stocks appeared to take the news in their stride, with Nasdaq futures up 0.2% as investors geared up for a slew of earnings from the so-called Magnificent Seven, including the likes of Microsoft, Apple and Tesla from Wednesday.

Even South Korea’s KOSPI quickly reversed earlier losses to be last up 0.8%.

Safe-haven gold climbed 1% to $5,066 an ounce, just shy of an all-time high of $5,110, while silver surged 6.4% to $110.60 an ounce, not far from a record of $117.70 just set on Monday.

In Asia, MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.4%. Japan’s Nikkei was off 0.1%, tempered by the recent sharp rebound in the yen that has clouded the outlook for its vast export sector.

Meanwhile, the Pakistani rupee registered marginal improvement, appreciating 0.01% against the US dollar in the inter-bank market on Tuesday. At close, the local currency settled at 279.82, a gain of Re0.03 against the greenback.

Volume on the all-share index decreased to 749.25 million from 870.44 million recorded in the previous close. The value of shares declined to Rs53.06 billion from Rs57.19 billion in the previous session.

K-Electric Ltd was the volume leader with 90.16 million shares, followed by Hascol Petrol with 47.95 million shares, and B.O.Punjab with 35.97 million shares.

Shares of 486 companies were traded on Tuesday, of which 160 registered an increase, 278 recorded a fall, and 48 remained unchanged.