KSE-100 sheds nearly 1% amid geopolitical volatility

A volatile trading session was observed at the Pakistan Stock Exchange (PSX) due to global geopolitical tensions and economic concerns, with the benchmark shedding nearly 1,600 points or 1% on Tuesday.

The market opened on a relatively positive note, with the benchmark index climbing to an intra-day high of 171,571.55 points during early trading hours. However, the momentum proved short-lived as selling pressure quickly emerged, dragging the index into negative territory.

The decline accelerated in the final trading hours, pushing the index near its intra-day low of 168,823.31 points.

At close, the benchmark index settled at 168,916.22, down by 1,590.09 points or 0.93%.

“The local bourse witnessed a rollercoaster session as investors navigated through heightened geopolitical uncertainty,” brokerage house Topline Securities said in its post-market report.

“Market sentiment remained fragile amid the ongoing USA-Iran conflict, where the lack of clarity on the geopolitical front kept participants on edge. Adding fuel to the nervousness, international oil prices continued their upward trajectory, triggering widespread profit-taking across key sectors and leading to a highly volatile trading session,” it added.

Index-heavy stocks including UBL, LUCK, ENGROH, HBL, HUBC and FFC collectively dragged the index down by 750 points, Topline said.

In a key development, the State of Pakistan’s Economy, Half Year Report FY26 revealed that despite headwinds from global trade-related uncertainty and domestic floods, Pakistan’s macroeconomic stability strengthened further in H1-FY26.

The central bank on Tuesday noted that the Middle East War poses significant risks to the macroeconomic outlook amid heightened uncertainty, where supply chain disruptions are likely to impact inflation trajectory, external trade and remittance flows, and the economic activity in Pakistan.

On Monday, the PSX witnessed a range-bound and subdued trading session as persistent geopolitical tensions between the United States and Iran dampened investor sentiment, prompting cautious participation and dragging the benchmark indices lower despite selective sectoral gains. The KSE-100 Index closed at 170,506.31 points, shedding 609.51 points or 0.36%.

Globally, oil crept higher, and the US dollar rose on Tuesday as hopes faded for a deal to get ships moving through the Strait of Hormuz, while a red-hot chip rally in chip stocks cooled and ​traders waited on US inflation figures.

US President Donald Trump said the ceasefire with Iran was “on life ‌support” after Tehran’s response to a US proposal to end the war made clear the two sides were still far apart.

Brent crude futures were up 0.7% to $105 a barrel. S&P 500 futures dipped 0.2%, and even the almost unstoppable KOSPI in Seoul ​slid 3%, pulling down other regional markets.

MSCI’s broadest index of Asian shares excluding Japan fell 1%, ​while Tokyo’s Nikkei was flat. European futures fell 1%.

Markets are keeping a watchful eye on ⁠Trump’s Wednesday visit to China, with expectations low for either progress on Iran or on the trade front, with the focus ​on the status quo holding.

Overnight, Wall Street had been resilient in the face of rising ​oil prices, with the S&P 500 and Nasdaq eking out the latest in a series of new closing highs.

US ​inflation data is due later in the day, with the headline consumer price index seen climbing to a hot 3.7% year-on-year.

Any ‌suggestion ⁠that the Federal Reserve may need to hike this year - rather than cut as investors had expected before the war - could rattle markets.

Meanwhile, the Pakistani rupee continued to gain against the US dollar during trading in the inter-bank market on Tuesday. At close, the local currency settled at 278.66, a gain of Re0.01 against the greenback.

Volume on the all-share index decreased to 1,017.42 million from 1,103.29 million recorded in the previous close.

However, the value of shares rose to Rs32.03 billion from Rs31.04 billion in the previous session.

Cnergyico PK was the volume leader with 154.13 million shares, followed by Hascol Petrol with 113.57 million shares, and K-Electric Ltd with 107.55 million shares.

Shares of 485 companies were traded on Tuesday, of which 106 registered an increase, 346 recorded a fall, and 33 remained unchanged.