KARACHI: The Pakistan Stock Exchange (PSX) experienced another day of significant selling on Thursday as equities entered a correction phase.

The KSE-100 Index, which had reached a historic high of 116,169.41 on December 16, 2024, plunged by 4,795 points, or 4.32%, closing at 106,274.98. This sharp drop followed the previous day's loss of 3,790 points, marking a total decline of nearly 10,000 points over just three sessions.Trading, selling pressure remained strong, pulling the index to an intra-day low of 105,937.37 before it settled higher. Sectors such as chemicals, commercial banks, power generation, and refineries saw heavy losses, with major stocks like MARI, HUBCO, HBL, and MCB ending in the red.

The market's downward trend continued after a similar slump on Wednesday, driven by profit-taking by investors. Analysts noted that the market correction was expected after the prolonged rally, with some suggesting that this downturn could present buying opportunities, particularly for those who missed out on the previous gains. A key factor contributing to the sharp sell-off was significant redemptions from local mutual funds and year-end profit-taking by institutions.

In addition to market dynamics, the government introduced a new tax bill aimed at tightening control over non-filers and generating economic resources. The bill includes measures that prevent non-filers from purchasing vehicles, property, or stocks beyond certain limits. Globally, markets also faced pressure, with Asian stocks sliding and the US Federal Reserve signaling caution in its approach to interest rate cuts. The global economic uncertainty added to the negative sentiment in the PSX, with the Pakistani rupee slightly depreciating against the US dollar.