PSX plunges 3,500 points due to increasing risk of showdown with India

The Pakistan Stock Exchange (PSX) plunged by more than 3,500 points on Wednesday as uncertainty took hold due to increasing risk of a showdown with India.

Information Minister Atta Tarar said that India was planning military action against Pakistan in 26 to 36 hours, spreading panic in the market.

The market maintained a downward trend throughout the day and finally the index closed at 111,326.57, down by 3,545.61 or 3.09 per cent, from the last close of 114,872.18, according to the data provided by the PSX.

Analysts attributed the plunge to the uncertain security situation after the Pahalgam terrorist attack of April 22 that killed at least 26 people.

 

The Dawn newspaper reported that Mohammed Sohail, chief executive of Topline Securities, attributed the decline to news of a likely attack in the next few days.

Awais Ashraf, director research at AKD Securities, said, Investors are worried about potential Indian military action against Pakistan, concerns that have intensified following the information minister's press briefing.

Yousuf M Farooq, director of research at Chase Securities, echoed the same sentiments. He said that the market was under pressure following the information minister's statement last night suggesting that India may take military action within the next 2436 hours.

The market in the short term will most likely follow news flows of Pakistan-India tensions, he added.

Sana Tawfik, head of research at Arif Habib Limited, also credited the slump primarily on geopolitical tensions between India and Pakistan.

Earlier in the day, Information Minister Tarar said that credible intelligence reports indicated that India was planning to conduct military action in the next 24 to 36 hours.

His statement came after India gave its military operational freedom to respond to the Pahalgam attack.