Profit-Taking Hits PSX Amid Focus on US Fed Decision

The Pakistan Stock Exchange (PSX) reversed momentum on Wednesday morning, losing nearly 400 points despite strong global cues and optimism over potential US interest rate cuts.

At 9:40am, the KSE-100 Index was at 156,181.72, down 381.80 points, or 0.24%. Selling pressure weighed on banking, energy, cement, and power generation stocks.

This decline followed Tuesday’s upbeat session when the market gained 476.22 points. Market insiders said investors opted for profit-taking even as international markets maintained bullish momentum.

Across Asia, equities tracked Wall Street higher after the S&P 500, Nasdaq, and Dow Jones all closed at record highs. Japan’s Nikkei rose 0.3%, South Korea’s KOSPI climbed 1.3%, and Taiwan’s benchmark surged 1.46% to a fresh peak.

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Investor sentiment globally is driven by expectations that the Federal Reserve will cut rates at its meeting next week. Markets are pricing in a quarter-point reduction, with some traders even betting on a larger half-point cut.

However, legal uncertainty surrounding US President Donald Trump’s attempt to remove Fed Governor Lisa Cook has injected caution. While the court temporarily blocked the move, analysts say the case could eventually test the central bank’s independence.

Despite supportive global trends, Pakistani investors remain cautious as profit-taking drags the index lower. Analysts expect short-term volatility but remain positive about the market’s medium-term trajectory.