PSX volatility persists amid political uncertainty, oil prices and profit-taking
KARACHI (Staff Report): The Pakistan Stock Exchange (PSX) witnessed a volatile trading session on Friday as investors weighed domestic political uncertainty, escalating geopolitical risks and fluctuating international oil prices against improving macroeconomic indicators and signs of recovery in the automobile sector.
The benchmark KSE-100 Index opened in negative territory, shedding 406 points to reach 176,967 points. However, renewed buying interest helped the market recover its early losses, with the index subsequently climbing to 177,568.13 points, gaining 194.37 points or 0.11 percent during early trading.
Market sentiment remained fragile amid reports concerning the possibility of former prime minister Imran Khan securing bail and being released from Adiala Jail. Although the reports have not established any confirmed release, speculation surrounding his possible release has added another layer of uncertainty to an already sensitive political environment.
Meanwhile, international developments continued to influence investor sentiment. US President Donald Trump’s latest statements regarding Iran, including his indication that Washington did not necessarily need an agreement with Tehran to end the conflict, have kept geopolitical uncertainty elevated.
Crude oil prices also remained a key concern for investors, with Brent crude trading around $95.41 per barrel on Friday. Continued tensions in the Middle East, particularly risks to shipping and energy infrastructure, have heightened concerns over potential external-sector pressures for oil-importing economies such as Pakistan.
However, the domestic economic outlook presented some encouraging signals. According to the latest State Bank of Pakistan (SBP) data, foreign exchange reserves held by the central bank increased by $11 million to $21.572 billion during the week ended November 6, taking the country’s total liquid foreign exchange reserves to $26.839 billion.
Financial expert Arsalan Ahmed said profit-taking was expected following the substantial rally witnessed by the stock market in recent weeks, with the benchmark having gained approximately 17,000 points.
He observed that investors could increasingly look to book profits after the strong upward movement, potentially keeping the market volatile in the near term.
Market participants are expected to closely monitor domestic political developments, international oil prices, geopolitical tensions and macroeconomic indicators for further direction.
Despite improving foreign exchange reserves and automobile sector performance, uncertainty surrounding political developments and global energy markets remains a significant challenge to sustaining the market’s recent bullish momentum.