After the government retains fuel subsidies, the PSX plunges almost 1,000 points.

The Pakistan Stock Exchange (PSX) was dominated by bears on Monday, with the benchmark KSE-100 index losing 1061.98 points in the first hour of trade.

The KSE-100 Index opened at 43,486.46 points on the PSX website and promptly plummeted by 806.95 points. The index had dropped over 1,000 points to 42,424.48, down 2.44 percent, by 10 a.m.

The drop comes a day after Finance Minister Miftah Ismail declared that the government would not raise gasoline prices “for the time being,” reversing a major precondition imposed by the International Monetary Fund (IMF) for the IMF’s loan programme to resume.

Ismail stated that he would speak with the IMF and find a solution. “I suggested raising [petrol] prices, but he claimed people couldn’t stomach it,” the finance minister explained.

He did stress, though, that gasoline prices might be “changed at any time in the future” in light of worldwide costs.

Today, Arif Habib, chairman of the Arif Habib Group, told Dawn.com that the government has to make harsh decisions in order to restore short-term market stability. “The route for the IMF programme must be built quickly by eliminating petroleum product subsidies; else, investor confidence will be impossible to rebuild,” he stated.

“Even under these conditions, the stock market is providing strong profits. The recent drop in investor confidence, on the other hand, is attributable to delayed government decisions on economic matters “Habib continued