A volatile session was observed at the Pakistan Stock Exchange (PSX), as investors entered a panic mode in the latter half of the trading session following reports of major flooding in the country. The benchmark KSE-100 Index settled with a loss of over 900 points on Wednesday.
Positive sentiments were observed during the initial hours of trading, pushing the benchmark index to an intra-day high of 149,237.91. However, selling pressure returned to the bourse, wiping out all gains, and dragged the index to an intra-day low of 147,337.02.
At close, the benchmark KSE-100 Index settled at 147,494.03, a decrease of 941.03 points or 0.63%.
Analysts at Arif Habib Limited (AHL) attributed the decline to “some panic in the second half of the session following news of major flooding in the north of the country”.
India on Wednesday opened all gates of major dams on rivers in Indian Illegally Occupied Jammu and Kashmir following heavy rains, and warned neighbouring Pakistan of the possibility of downstream flooding, an Indian government source said.
Pakistan said Islamabad received the warning and subsequently issued an alert for flooding on three rivers which flow into the country from India.
Arch-rivals India and Pakistan have been ravaged by intense monsoon rains and flooding in recent weeks.
On Tuesday, PSX closed the session on a negative note, with key indices retreating amid significant intraday volatility. The KSE-100 Index settled at 148,435.06 points, down 380.24 points or 0.26%.
Internationally, Asian stocks were steady on Wednesday ahead of an earnings report from AI leader Nvidia that will shape near-term risk sentiment, while the US dollar was frail as investors remained nervous about attacks on Federal Reserve autonomy.
The US Treasury yield curve has been steepening since President Donald Trump on Monday ordered the firing of Federal Reserve Governor Lisa Cook, an unprecedented move that could lead to a legal tussle after a lawyer for Cook said she will file a lawsuit to prevent it.
Trump has repeatedly criticised Powell and policymakers for not cutting interest rates. Market watchers interpreted Powell’s comments last week as indicating cuts could be on the way.
That has led to investors wagering a cut next month, with traders pricing in an 84% chance of the Fed moving in September and expecting more than 100 bps of easing by June.
Data showed options traders are pricing in about a $260 billion swing in Nvidia’s market value after the firm reports earnings, where its business in China will be in focus following an unusual profit-sharing deal with the Trump administration.
Caught in the crossfire of a Sino-US trade war, the fate of Nvidia’s China business hangs on where the world’s two largest economies land on tariff talks and chip trade curbs.
That has left traders hesitant in placing major bets. MSCI’s broadest index of Asia-Pacific shares outside Japan up just 0.2%, Japan’s Nikkei was little changed, and share prices in Taiwan were up 0.6%.
China’s blue-chip stocks gained 0.3%, hovering near a three-year high touched earlier in the week. Stocks in China have been on a tear recently, buoyed by tech sector.
Meanwhile, the Pakistani rupee registered marginal improvement, appreciating 0.01% against the US dollar in the inter-bank market on Wednesday. At close, the rupee settled at 281.83, a gain of Re0.03 against the greenback. This was rupee’s 14th consecutive gain against the greenback.
Volume on the all-share index increased to 856.66 million from 665.42 million recorded in the previous close.
The value of shares declined to Rs29.29 billion from Rs31.54 billion in the previous session.
Pace (Pak) Ltd was the volume leader with 87.76 million shares, followed by Bank Makramah with 58.85 million shares, and TPL Properties with 42.67 million shares.
Shares of 477 companies were traded on Wednesday, of which 129 registered an increase, 312 recorded a fall, while 36 remained unchanged.