Indian Stock Market Today: Pakistan Bourse Plunges Amid Tensions
The Pakistani market's resilience will be tested in the coming days, with investors eagerly awaiting the outcome of the IMF board meeting and the de-escalation of tensions with India, which will have a significant impact on the Indian stock market today.
Pakistan Stock Exchange's benchmark KSE-100 Index plummeted 6,500 points at the opening, but recovered to 110,954.40 by 2:30pm, still down 2.3%, as investors remain optimistic about the upcoming IMF board meeting.
The decline was triggered by heightened geopolitical tensions between Pakistan and India, with the heaviest fighting in over two decades erupting along the frontier in Kashmir. Index-heavy stocks, including OGDC, PPL, POL, HUBCO, SNGPL, and SSGC, traded in the red, while commercial banks, oil and gas exploration companies, OMCs, power generation, and refinery stocks were sold.
The market volatility was also affected by reports of Indian strikes on multiple Pakistani locations, resulting in 13 deaths and 35 injuries. In retaliation, the Pakistan military brought down five Indian Air Force jets. Despite the tensions, some analysts believe the situation will remain short-lived and see the market decline as a buying opportunity.
Moody's has warned that sustained India-Pakistan tensions could negatively affect Pakistan's growth and disrupt foreign funding flows. However, investors are optimistic about the upcoming IMF board meeting, which will decide on the loan tranche for Pakistan. The IMF Executive Board meeting on May 9 will deliberate on a $1.3 billion staff-level agreement under the Extended Fund Facility (EFF).
As the situation continues to unfold, investors will be closely watching the developments and their impact on the Indian stock market today, as well as the Pakistan Stock Exchange. The market's ability to recover from the decline will depend on the easing of tensions between the two countries.