The Pakistan Stock Exchange (PSX), which had been named Asia’s best-performing stock market in August 2020, reversed course and became the region’s third-worst performer amid rising political tensions and a melting economy.
Market capitalization (the total worth of all listed businesses) fell to a multi-year low of Rs. 6.95 trillion on Thursday, compared to a peak of Rs. 8.29 trillion in June 2021, wiping out 16.27 percent (or Rs. 1.35 trillion) of investment on the PSX.
In terms of market capitalization loss, the petroleum refinery was the worst-affected sector. In March, the sector’s capitalization was Rs. 66 billion, down from Rs. 146.56 billion at the end of June 2021.
According to the Pakistan Economic Survey 2021-22, the cement sector lost 24% of its market capitalization during July-March FY22, while the capitalization of vehicle assemblers fell 13%.
The benchmark KSE-100 index fell 5.1 percent (or 2,427 points) in the first nine months (July-March) of the previous fiscal year, closing at 44,929 points on March 31, according to the study, making PSX the third-worst performing market in Asia.
According to the latest data, the PSX has become the region’s second worst-performing market behind Sri Lanka for the entire current fiscal year (July-June FY22).
According to Arif Habib Limited (AHL), PSX has dropped over 31% in dollar terms so far this fiscal year.
“Pakistan stock market’s performance has posted a boom-and-bust situation during FY2022 (Jul-Mar) due to geopolitical tension, especially Russia-Ukraine conflict, and domestic political uncertainty,” the survey said.
The latest available data has painted a further worsening picture of the equity market.
The benchmark index has lost 13.25% (or 6,376 points) over the past year and closed near a two-year low at 41,736 points on Thursday.
On Thursday alone, the KSE-100 index rose 0.44% (or 183 points) on a day-to-day basis and closed at 41,736 points, according to the PSX data.
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