Pakistan’s Stock Exchange is Now Asia’s 3rd Worst Stock Market

The Pakistan Stock Exchange (PSX), which had claimed the distinction of Asia’s highest performing stock market in Aug 2020, reversed course and became the region’s third worst-performing market amid rising political tensions and a collapsing economy.

According to the study, the PSX became Asia’s third-worst performing market when the benchmark KSE-100 index fell 5.1% (or 2,427 points) in the first nine months of the current fiscal year and finished at 44,929 points on March 31.

According to the most recent statistics, the PSX has become the region’s second poorest performing market behind Sri Lanka for the whole current fiscal year (Jul-Jun FY22). According to Arif Habib Limited, PSX has dropped about 31% in dollar terms in the current fiscal year (AHL).

Investors saw their investment at the PSX wiped out by 16.27% (or Rs1.35 trillion), as market capitalization (the entire worth of all listed businesses) fell to a multiyear low of Rs6.95 trillion on Thursday, compared to a peak of Rs8.29 trillion in June 2021.

In terms of market capitalisation, the petroleum refinery was the worst-affected industry. The sector’s capitalization has been cut to Rs66 billion in March, from Rs146.56 billion at the end of June 2021.

The most recent data available paints an even more bleak picture of the equities market. Over the last year, the benchmark index has dropped 13.25% (or 6,376 points) and finished at a two-year low of 41,736 points.

According to the National Clearing Company of Pakistan Limited, foreign investors have withdrawn a net $1.61 billion from Pakistan’s stock market since July 1, 2017.

The significant fluctuation in the rupee-dollar parity has remained the primary reason for foreigners’ withdrawal from the domestic exchange since abrupt currency depreciation has harmed their investment.

Did you know the Pakistan stock market has witnessed a heavy loss of Rs 914 billion in the last two months?