Stocks slump amid geopolitical tensions, KSE-100 down nearly 2,300 points

Negative sentiments engulfed the Pakistan Stock Exchange amid escalating tensions between the US and Iran, with the benchmark KSE-100 Index shedding nearly 2,300 points during the opening minutes of trading on Monday.

At 9:43am, the benchmark index was hovering at 179,972.52, down by 2,269.25 points or 1.25%.

Across-the-board selling was observed in key sectors, including automobile assemblers, cement, commercial banks, oil and gas exploration companies, OMCs and power generation. Index-heavy stocks, including HUBCO, MARI, OGDC, PSO, SSGC, SNGPL, MCB, MEBL, NBP and UBL traded in the red.

During the previous week, the PSX snapped its winning streak as renewed geopolitical tensions following fresh US-Iran military strikes dampened investor sentiment, prompting widespread selling and dragging the benchmark index lower.

The benchmark KSE-100 Index declined by 1.7% on a week-on-week basis, losing 3,130.43 points to close at 182,241.77 points.

Internationally, share markets slid in Asia on Monday as fighting intensified ​in the Gulf and Iran claimed to have closed the vital Strait of Hormuz, sending oil prices surging and rekindling inflation risks globally.

The ‌dollar rose with bond yields as investors narrowed the odds of a hike in interest rates from the Federal Reserve, just a day before Chair Kevin Warsh is due to face Congress for the first time in his new role.

Inflation figures for June on Tuesday could show some cooling in the headline rate of 4.2% as petrol prices decline, though some of that will reverse now that oil ​is rising anew.

Brent crude climbed 4.1% to reach $79.11 a barrel, up from the recent trough of $70.14, while U.S. crude added 4.1% to $74.37 a barrel.

U.S. officials ​said around 20 vessels had been escorted through the strait in the previous 24 hours, though ship tracking sites showed little ⁠traffic moving.

Equity investors will be hoping the earnings season proves as upbeat as forecast, with the major banks kicking off from Tuesday, while Netflix and General Electric are ​also on the docket.

S&P 500 futures eased 0.4%, while Nasdaq futures lost 0.9%. In Europe, EUROSTOXX 50 futures and DAX futures both fell 0.6%, while FTSE futures dipped 0.1%.

Japan’s Nikkei fell 1.6%, having shed ​1.7% last week, while MSCI’s broadest index of Asia-Pacific shares outside Japan dropped 0.9%.

South Korea’s formerly red-hot market shed 5.4%, and will be in focus, ​having lost almost 8% last week as leveraged bets on semiconductor shares came under pressure. The market has emerged as a key global barometer for chip-sector sentiment, and further losses could ‌ripple out ⁠more broadly.

This is an intraday update