PSX Among Asia’s Worst Performing Markets

Pakistan Stock Exchange (PSX) is among five Asian equity markets which showed negative growth in the first nine months of the current fiscal year, according to the Economic Survey of Pakistan 2021-22.

The dip has been observed in February and March 2022 due to the geopolitical tension, especially the war between Russia and Ukraine which plummeted the global indices.

Major Asian stock market indices presented a mixed picture during the first nine months of FY22. Jakarta Composite Index has seen the highest growth of 18.1 percent, while Hong Kong’s Hang Seng Index declined by 23.7 percent, revealing the highest decline during the period July 2021 to March 2022.

PSX At Glance

Pakistan’s stock market’s performance has posted a boom-and-bust situation during FY2022 due to geopolitical tension especially the Russian Ukraine conflict and domestic political uncertainty.

From July 2021 to March 2022, the benchmark KSE-100 index declined from 47,356 points to 44,929 points. During this period, the index closed at its highest point of 48,112 points on August 23, 2021. As of March 31, 2022, the number of listed companies stood at 532, with a total market capitalization of Rs 7,583 billion.

The turnover in shares reached its peak in September 2021, indicating that investors were actively investing in the market. However, the market activity slowed down in February and March 2022 due to geopolitical and domestic political uncertainty.

The major development of this year in the equity market is the issuance of Initial Public Offerings (IPOs). During July-March FY22, five companies issued shares through IPOs on the main board of the Pakistan Stock Exchange (PSX), while two companies were listed on the newly introduced Growth Enterprise Market (GEM) Board.

During July-March FY22, a total of Rs 714.3 billion was wiped out from the market capitalization of the PSX.

It is evident that out of five major companies in the PSX, Meezan Bank Limited and Mari Petroleum Company Limited’s share price has a positive growth. The fall in the share price of Pak Tobacco is partly explained by the negative growth of 28 percent in the Tobacco industry. The share price of Nestle has dropped as Food & Personal Care Products companies posted modest growth of 1.2 percent.