Heavy selling hits PSX, KSE-100 tumbles 2,500 points on US-Iran talks fallout
- Benchmark index settled at 178,922.75 points
The Pakistan Stock Exchange (PSX) endured a volatile session on Friday, with the KSE-100 Index shedding over 2,400 points amid aggressive selling after it was learned that talks planned for Friday between the United States and Iran in Switzerland will not take place.
The market opened in positive territory and initially moved higher, touching an intraday high of 182,185.87 points. However, the positive momentum was short-lived as selling emerged before noon, triggering a steep decline that erased all early gains.
The index then plunged to an intraday low of 177,836.16 points, reflecting a swing of more than 4,300 points between the day’s high and low.
After hitting the day’s low, the market staged a partial recovery during the second-half of the trading session. However, renewed selling in the final hour trimmed gains.
At close, the benchmark index settled at 178,922.75 points, a decline of 2,475.46 points or 1.36%.
US Vice President JD Vance pulled out of a planned trip to meet Iranian negotiators in Switzerland on Friday to begin complex talks on implementing the 14-point agreement, opens new tab struck between Tehran and Washington to end their war, opens new tab, a White House spokesperson said.
US officials said this week they would hold a formal signing ceremony for the US-Iran agreement in Geneva, but Iran’s foreign ministry cast doubt on that, saying it was unnecessary after both countries’ presidents signed the agreement on Wednesday.
On Thursday, the PSX extended its bullish momentum as declining international crude oil prices and growing optimism surrounding a potential peace agreement between Iran and the United States continued to strengthen investor confidence, triggering broad-based buying across key sectors. The benchmark KSE-100 Index gained 887.20 points, or 0.49%, to close at 181,398.22 points.
Internationally, shares climbed to record highs in Japan and South Korea on Friday as peace in the Middle East, with the reopening of the Strait of Hormuz, pulled oil prices even lower and eased inflation fears.
The US dollar was on a tear, hovering near a 13-month high on its major peers, after a hawkish turn from the Federal Reserve led markets to price in more than one rate hike this year. That dragged the yen to the weakest level in two years and intensified speculation that Japanese authorities might have to intervene soon and stem the currency’s slide.
Oil tankers have started sailing through the Strait of Hormuz after the United States lifted its blockade on Iran on Thursday as an interim deal to end the three-month war took effect. Brent crude futures dropped 1% on Friday to $79.03 a barrel, and were down 9.5% for the week.
Share markets have had a blockbuster week.
Japan’s Nikkei gained 0.8% to hit a new record for the fifth straight session, extending its weekly gain to 8.5%. South Korea jumped 3.1%, adding to its weekly rise of 15.3%.
Mainland China and Hong Kong’s stock markets are closed for the Dragon Boat Festival holiday. Taiwan was also on holiday.
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