KSE-100 Index slides nearly 2% amid heavy selling pressure

Selling pressure was observed at the Pakistan Stock Exchange (PSX), with the benchmark KSE-100 Index shedding nearly 2% on Monday.

The market opened on a negative note, with the KSE-100 Index dropping to 172,461 points.

Selling pressure persisted throughout the trading session and intensified further during the final hours of trading, dropping to an intra-day low of 170,396.85.

At close, the benchmark index settled at 170,600.20, down by 3,362.61 points or 1.93%.

“The negative momentum was primarily driven by a surge in international oil prices amid rising geopolitical tensions in the Middle East, as conflict between Israel and Lebanon escalated. Elevated oil prices revived concerns over inflation and external account pressures, dampening investor confidence and triggering broad-based selling across key sectors,” brokerage house Topline Securities said in its post-market report.

Oil prices rose more than 3% ‌on Monday after Iran and the US traded strikes and Israel ordered troops to move further into Lebanon in its battle with Hezbollah.

Brent futures were up $2.68 or 3% at $93.80 a barrel at 1121 GMT. U.S. crude futures ​rose $3.03 or 3.5% to $90.39 a barrel. Over May, Brent and WTI lost around 19% ​and 17%, respectively. It was both contracts’ biggest monthly fall in absolute ⁠terms since March 2020 when the coronavirus pandemic slashed energy demand.

Adding to the cautious mood, Pakistan’s CPI for May 2026 clocked in at 11.66%, compared to 10.89% in the previous month, signaling a pickup in inflationary pressures and further weighing on investor sentiment.

The bearish momentum was largely fueled by heavyweight stocks, including ENGROH, FFC, LUCK, HUBC, and OGDC, which collectively shaved 1,464 points off the benchmark index, playing a key role in sustaining the market’s downward trajectory, Topline said.

Meanwhile, Behtari Capital said investors were treading cautiously ahead of the federal budget, i.e. June 5.

Investor sentiment was dampened by reports that the government was struggling to balance IMF demands with populist political measures, added the report.

“While there is talk of relief for the salaried class (earning Rs. 150k-200k), the IMF is pushing for a record Rs17+ trillion revenue target, sparking fears of “super taxes” on the banking and industrial sectors in the upcoming June 5 budget,” it said.

During the previous week, Pakistan equities posted a strong recovery during the outgoing week as easing geopolitical tensions in the Middle East and improving domestic economic indicators significantly boosted investor confidence, helping the KSE-100 Index gain 4% in a holiday-shortened trading week. The benchmark index surged by 6,119 points on a week-on-week basis to close at 173,963 points.

Internationally, Asian share markets firmed on Monday as the boom in all things AI continued to ​drive demand, offsetting a lack of progress in Gulf peace talks that challenged optimism on a re-opening of the Strait ‌of Hormuz and lifted oil prices.

While negotiators from Washington and Tehran are apparently working to hammer out a deal, President Donald Trump has been notably silent on their progress. Speaking on Saturday, Defence Secretary Pete Hegseth said the US was ready to restart attacks on Iran if a deal could not be reached.

Tensions in the region were not helped ​by an Israeli push further into Lebanon in the battle against the Iranian-backed Hezbollah group.

Asian share markets remain underpinned by demand for semiconductors and AI-related gear, with Japan’s Nikkei up a further 0.5%, having risen almost 5% last week to all-time highs.

South Korea rose 1.3%, after surging 8% last week, while Taiwan climbed almost 6% last week. MSCI’s broadest index of Asia-Pacific shares outside Japan added 0.2%.

Meanwhile, the Pakistani rupee appreciated 0.01% against the US dollar in the inter-bank market on Monday. At close, the local currency settled at 278.47, a gain of Re0.03 against the greenback.

Volume on the all-share index increased to 589.76 million from 555.06 million recorded in the previous close.

The value of shares rose to Rs31.98 billion from Rs40.88 billion in the previous session.

Dewan Cement was the volume leader with 43.32 million shares, followed by TRG Pak Ltd with 39.41 million shares, and WorldCall Telecom with 34.96 million shares.

Shares of 489 companies were traded on Monday, of which 168 registered an increase, 296 recorded a fall, and 25 remained unchanged.