The case study focuses on Problems and Challenges faced by Pakistan Stock Exchange in bringing investment in the country and giving the desired boost to the economy. Stock Exchanges international means of investment Pakistan Stock exchange relatively is a smaller exchange in terms of its Capitalization when compared with Stock Exchanges of New York, London, Tokyo, Hongkong, Bombay and the European stock exchanges. Normally stock exchanges are considered as investment venues. From where investment flows into the economy, in joint stock companies. Global integration between markets has made international investors alike in their expectations and are looking for best return on their stock. A survey of 70 countries during 1985-1995 by using Granger casualty test. They found little relationship between stock market activity and economic growth specially in lower income countries. Filer, Hanhousek, and Campos (2000) Journal of economic development studies Vol 3(2) June 2015 Country interest rates, Central bank monetary policies regarding money supply and control of inflation and country current Balance of payment, gold prices are major determinants of share prices. Local and foreign economic policies also affect stock markets. In the present Global economy interest rates, currency exchange rates between countries also affect stock exchange indices (Dow Jones, and others). Capital movement between Stock exchanges are affected by the above factors and indices of stock exchanges are affected by Capital flow from one to other stock exchange. Funds are looking for best returns and move between markets where returns become more attractive. The performance of an undervalued Stock Exchanges, its index, would improve and later with funds disinvesting would show a lower index. These Stock exchange indexes do not truly reflect economic growth of the country. Ozen, Ercon and Tetik, Metin (Oct 2019) Frontiers in Applied Mathematical Science Key Words PSX, interest rates, Currency rate, Capital movement