ISLAMABAD: As expected, after reaching a record high during the last two months, the Pakistan Stock Exchange (PSX) observed a continued bearish trend for the last couple of days amid the profit-taking and correction process.
On Tuesday, the 100 Index witnessed a massive decline by 2,534 points, a fall of over 4% in a single day, settling at 59171 against the previous day’s stand of 61705. Last week, the index also observed another bearish trend with over 2300 points in a single day.
After the last 2 months’ bullish trend, the index surpassed the recorded benchmark of over 66400 points on December 12.
Meanwhile, on Tuesday, selling pressure dominated the market, including heavy sectors like automobile assembly, commercial banks, cement, chemical, oil and gas marketing and exploration companies, refineries, pharmaceuticals, etc. Most of these companies remained in the red zone and opted for selling.
Experts believe the continued bearish trend happened due to the selling pressure in the context of the correction process as the market reached an unprecedented level a week before, and a decline was expected.
In a key development, the Sindh High Court (SHC) also suspended the SRO 1588(I)/2023 of the Federal Board of Revenue (FBR), which has imposed a 40% additional tax on windfall income of banks.
Meanwhile, trading in the international market also remained steady and thin due to Christmas celebrations and the closure of markets in several countries, including Australia, New Zealand, Hong Kong, etc., for the Christmas and Boxing Day holidays.
Bullish, Bearish Trend at PSX
During the last two months, the market witnessed a massive Bullish trend, while during the last several months, the KSE-100 Index has recorded a historic bullish spree while gaining about 60%.
It was the reason the last two weeks suffered a major bearish trend due to the profit-taking and correction process. Only in the last two months, the 100-index gained over 14000 points. In November, the 100-index achieved more than 8000 points, while during the last five months, the 100-index achieved 24000 plus points.
Meanwhile, in the last couple of weeks, we enjoyed several consecutive all-time highs at PSX. After breaking a few records in the middle of November, the index surpassed a new historic high and crossed the 58000 mark. At the end of November, the index crossed the 60000 benchmark. Meanwhile, the 100-index continued the same bullish trend in the first quarter of December, and till December 15, it gained over 5000 points.
However, for several days (since December 13), the market switched over to the bearish trend with a massive decline last Tuesday (over 2300 points), followed by another bearish trend of over 1100 points last Friday and the bloodbath this Tuesday by over 2500 points.
