Stocks close lower on pre-budget uncertainty

KARACHI: The Pakistan Stock Exchange (PSX) closed lower on Monday, as investors adopted a cautious stance amid uncertainty ahead of the federal budget.

The benchmark KSE-100 index dropped by 881.55 points, or 0.74 per cent, to 118,221.12 points, down from 119,102.67 points recorded in the last session. The highest index of the day remained at 119,290.94 points, while the lowest level was recorded at 118,150.28 points.

Analyst Ahsan Mehanti at Arif Habib Ltd attributed the decline in stocks to “pre-budget session” pressure. Reports of higher petroleum levies; concerns over pending IMF approval on resolving circular debt plan; and delays over Budget FY26, now to be presented on June 10, impacted the sentiments.

He said that rupee instability and geopolitical tensions played a catalytic role in the bearish activity. The KSE-30 index decreased by 346.55 points or 0.95 per cent to 35,955.2 points from 36,301.75 points.

Traded shares rose by 297 million shares to 635.535 million shares from 338.003 million shares. The trading value increased to Rs18.576 billion from Rs18.511 billion. Market capital narrowed to Rs14.325 trillion against Rs14.385 trillion. Of the 467 companies active in the session, 188 closed in green, 235 in red and 44 remained unchanged.

Maaz Mulla, an analyst at Topline Securities, said the local bourse witnessed a profit-taking session on Monday as uncertainty continued to weigh on investor sentiment. He said the bearish trend was primarily driven by concerns over the delay in the federal budget announcement and the lack of clarity regarding the IMF conditions tied to it. In the absence of positive triggers, investors chose to trim their positions and adopt a cautious stance.

K-Electric Ltd led the volume chart, closing at its upper circuit, following news that KE has secured a dollar-linked tariff for its transmission and distribution business.Energy stocks came under pressure amid rumours of a potential delay in the clearance of circular debt, with PPL, OGDC and PSO emerging as major losers.

On the downside, key index heavyweights including ENGROH, SYS, PSO, FFC and OGDC collectively contributed to a 452-point decline in the benchmark index.The highest increase was recorded in PIA Holding Company Limited B, which rose by Rs2,006.32 to Rs22,069.53 per share, followed by Khyber Textile Mills Limited, which increased by Rs190.61 to Rs2,096.7 per share. A significant decline was noted in Rafhan Maize Products Company Limited, which fell by Rs72.36 to Rs10,755.23 per share; Sazgar Engineering Works Limited followed it, which closed lower by Rs36.29 to Rs1,216.17 per share.

Analyst Mohammed Hasan Ather at JS Global said the KSE index fell, as investor sentiment weakened due to the government’s delay in presenting the federal budget and ongoing uncertainty surrounding IMF fiscal targets. “The postponement of Budget 2025-26 and unresolved negotiations with the IMF are driving the risk-off behaviour,” he said.

He added that market direction remains contingent on clarity from upcoming IMF discussions and the budget announcement; volatility is likely to persist until fiscal policy details are finalised.

KE remained the volume leader with 246.932 million shares, which closed higher by Re1.0 to Rs5.72 per share. WorldCall Telecom, with 36.720 million shares, followed it, which closed higher by 2 paisas to Rs1.27 per share.

Other significant turnover stocks included Telecard Limited, PTCL, Kohinoor Spining, Big Bird Foods Ltd, Hira Textile, Cnergyico PK, Siddiqsons Tin and Fauji Foods Ltd.In the futures market, 318 companies recorded trading, 95 of which increased, 217 decreased and 6 remained unchanged.