Pakistan stocks slide over 1,200 points amid protests, IMF forecast cut

Pakistan stocks ended lower Wednesday, hit by escalating protests over controversial canal projects that blocked a key highway critical for transporting goods between Karachi and the upcountry. The disruption, now in its sixth day, has slowed economic activity nationwide.

The benchmark Pakistan Stock Exchange (PSX) dropped 1,204 points, or 1.02%, to close at 117,226 points. Protestors stalled the smooth flow of trucks and lorries, leaving nearly 20,000 stranded along the highway and adjacent areas.

Key traders' associations warned the prolonged blockade could result in losses of billions of rupees daily. The economic sentiment further deteriorated after the International Monetary Fund (IMF) revised its GDP growth forecast for Pakistan to 2.6% for the current fiscal year, down from the 3% projected last year.

“Stocks closed sharply lower after IMF slashed GDP growth forecast to 2.65% for FY25 amid Trump tariff blow,” said Ahsan Mehanti of Arif Habib Corp. “Fitch Ratings forecast on weakening rupee, political noise and fears over fallout on Indian-occupied Kashmir security unrest played catalyst role in bearish close at PSX,” he added.

An analyst from Ismail Iqbal Securities said the benchmark index ended in the negative zone due to rollover week activity and result season volatility. Trading volumes fell to 243 million shares compared to 354 million in the previous session.

Commercial Banks, Power Generation & Distribution, and Oil & Gas Exploration Companies sectors were the major laggards, cumulatively shedding 666 points from the index.

The Pakistani rupee weakened against the dollar, closing at PKR 280.97 in the interbank market, down 20 paisa. Analysts attributed the dip to Fitch Ratings’ warning of further currency weakening.

According to an analyst from Topline Securities, “After four consecutive sessions of bullish momentum, bears made a forceful comeback on the local bourse.” This reversal was largely driven by escalating regional geopolitical tensions, prompting investors to adopt a cautious stance and lock in recent gains.

The index’s decline was notably driven by losses in key stocks including UBL, HUBC, HMB, MARI, and ENGROH.

Gold Prices

Gold prices in Pakistan dropped by PKR 11,700 on Wednesday. The price per tola stood at PKR 363,700, while in international markets, gold traded at approximately $2,297 per ounce.