Karachi: The KSE-100 index experienced a significant decline, failing to maintain its intraday peak of 140,331 and closing at 137,965, marking a drop of 1,415 points. Trading volumes saw a slight increase, reaching 606 million shares compared to 589 million in the previous session.

The index is expected to test its support levels between 137,430 and 137,640, with concerns that a further decline could trigger a corrective trend targeting 135,480. Conversely, resistance is anticipated in the range of 138,640 to 139,650, with a potential breakout aiming for 140,585.

Technical indicators such as the Relative Strength Index (RSI) have generated a sell signal, and the Moving Average Convergence Divergence (MACD) is trending downward, both supporting a corrective outlook. Investors are advised to exercise caution at current levels, with support and resistance noted at 136,957 and 139,651, respectively.

In stock-specific strategies, Pakistan State Oil (PSO) is advised to 'buy on dips' with target prices set at Rs387.50 and Rs397.13, maintaining a stoploss at Rs370.00. Meanwhile, Honda Atlas Cars (HCAR) is also suggested to 'buy on dips', targeting Rs299.09 and Rs303.28, with a stoploss at Rs289.72.