KSE-100 plunges over 450 points amid uncertainty on upcoming budget

Apprehensions pertaining to the upcoming budget FY23-24 pushed the Pakistan Stock Exchange (PSX) into the red zone, as the benchmark KSE-100 Index lost over 450 points during the trading session on Thursday.

At 4:10pm, the KSE-100 Index was being traded at 41,686.46 level, a decline of 456.25 points or 1.08%.

Across-the-board buying pressure was witnessed with the index-heavy sectors including, commercial banks, automobile assemblers, cement, chemicals, fertilisers, oil & gas exploration companies and OMCs trading in red.

Experts were of the view that the market remains anxious regarding the proposals to be announced in the upcoming budget, which is scheduled to be announced on Friday.

“Concerns pertaining to budget FY23-24 are driving this negative sentiment at the bourse,” Fahad Rauf, Head of Research at Ismail Iqbal Securities Limited, told Business Recorder.

“There are concerns that additional taxes could be imposed on listed companies including banks,” he said.

The market expert said that there are also concerns that the government could give a populist budget, in its bid to woo voters. “If happened, this could dent the International Monetary Fund (IMF) programme,” he said.

Esther Perez Ruiz, IMF resident representative for Pakistan, said on Thursday that the country has to satisfy the lender on three counts, starting with a budget to be presented on Friday before its board will review whether to release at least some of the $2.5 billion still to be disbursed under a lending programme that will expire at the end of this month.