The Pakistan Stock Exchange (PSX) reopens to an 8,000-point plunge as global market turmoil sparks panic. Trading halts for an hour after the benchmark KSE-100 index falls by 6,000 points. When trading resumes, it drops another 2,000 points, reaching a record 8,000-point decline. This follows global market turmoil caused by China’s retaliatory tariffs against the United States.
The PSX halts trading as a safeguard against panic selling. These automatic circuit breakers give investors a chance to reassess during extreme market volatility. By 11:58 AM, the KSE-100 index declines by 6,287.22 points, or 5.29%. Trading pauses for one hour, resuming at 1:03 PM. The market then drops a total of 8,429.49 points, or 7.1%, bringing the index to 110,362.17 from the previous close.
Analysts attribute the drop to global recession fears. Awais Ashraf, director of research at AKD Securities, believes investors worry that tariff hikes could lead to a global recession, resulting in weaker demand. Despite this, he notes that lower global commodity prices might benefit Pakistan, an import-led economy. Similarly, Mohammed Sohail, CEO of Topline Securities, connects the decline to the global market crash.
The PSX suspension occurs after a 5% decrease in the KSE-30 index from the previous day. This leads to the cancellation of all outstanding orders. According to a statement by PSX, the market resumes after the cooling-off period. Analysts like Yousuf M. Farooq, director at Chase Securities, emphasize that a global recession has impacted markets broadly.
Selling pressures affect various sectors, including oil and banking stocks. Lower oil prices hurt earnings for oil exploration companies. Meanwhile, textile exporters face challenges due to new US tariffs. Farooq suggests that the short-term impact of the tariffs on Pakistan’s textile sector may be negative. However, he sees potential long-term benefits if commodity prices remain low.
On a broader scale, the global market continues to face intense pressure. Asian markets see declines, with Hong Kong shedding 10%, Tokyo diving 8%, and Taipei losing more than 9%. Global demand concerns lead to a drop in commodities. Oil prices fall significantly, further increasing market volatility. As Trump imposes tariffs on the US’s trading partners, global markets react negatively.
The situation worsens when China announces retaliatory tariffs of 34% on US goods from April 10. Trump’s stance on the tariffs causes further concern, with markets reacting negatively. The global economic environment becomes uncertain, with multiple sectors facing declines across the board.
The trade war between the US and China adds significant pressure on global economies. As fears of a global recession increase, market volatility intensifies. Economic analysts predict the US recession could last through the year, impacting China and global demand further. Investors remain cautious, awaiting developments in the trade dispute between the world’s two largest economies.
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