The Pakistan Stock Exchange (PSX) faced a severe downturn at the outset of the last business day of the week, witnessing a sharp decline as the PSX-100 index plummeted, breaching two critical benchmarks of 72,000 and 73,000. The index tumbled to 7,1090.
This downward spiral was primarily attributed to the influence of the International Monetary Fund (IMF), which issued directives hinting at the implementation of a new tax totaling Rs2 trillion in the upcoming budget. Consequently, investor confidence took a hit, leading to a negative market sentiment.
According to brokers, there are indications of a potential hike in the capital gains tax on share income within the forthcoming budget. This report further exacerbated concerns among market participants, fueling apprehensions about the impact of impending fiscal policy changes on investment returns.
Such regulatory interventions and policy speculations often trigger volatility in financial markets, prompting investors to reassess their strategies and risk exposures in light of anticipated shifts in taxation and fiscal measures.
The PSX’s sharp decline underscores the sensitivity of markets to external factors and policy announcements, highlighting the need for investors to remain vigilant and adapt their investment approaches accordingly to navigate through periods of uncertainty.
