KSE-100 slips to 188,202.85 points as market reacts to SBP rate decision

KARACHI (Dunya News) — Pakistan’s benchmark stock index, the KSE-100, closed in negative territory on Tuesday, ending at 188,202.85 points, down 0.2% from the previous close of 188,587.66, as investors reacted to the State Bank of Pakistan’s decision to keep the key policy rate unchanged.

The index showed volatility throughout the session, touching an intraday high of 189,521.32 points in early trading before slipping to a low of 187,538.23. By midday, the benchmark stood at 188,001.04 points, down 586.62 points.

Trading activity remained moderate, with total volumes recorded at 341.60 million shares and a market value of Rs40.22 billion.

Market participants attributed the subdued performance to the central bank’s announcement on Monday to maintain the policy rate at 10.5%. Industry leaders and traders said the decision fell short of expectations, adding to uncertainty in the market.

Arif Habib Limited noted that it had anticipated a 75-basis-point cut by the Monetary Policy Committee, which would have lowered the rate to 9.75% and marked a return to single-digit interest levels.

Federation of Pakistan Chambers of Commerce and Industry (FPCCI) President Atif Ikram Sheikh said the business community had sought a much steeper reduction of 350 basis points to bring the policy rate down to 7%, arguing that high energy costs and expensive borrowing were placing severe pressure on industry and slowing economic activity.
Despite the broader market decline, the banking sector showed relative resilience. Most listed banks traded in positive territory, with only Askari Bank, MCB Bank Ltd, Samba Bank and United Bank ending the session in the red.