PSX plummets by 6,000 points on Middle East tensions

KSE-100 closes at 182,338 after institutional sell-off; support breached

The Pakistan Stock Exchange (PSX) endured one of its darkest sessions in recent history on Thursday as the benchmark KSE-100 Index plummeted over 6,000 points, closing at over 182,300 due to tensions in the Middle East.

What was once a steady climb toward new records transformed into a frantic sell-off driven by a "perfect storm" of international conflict and domestic corporate disappointment.

"Market sentiment deteriorated amid escalating geopolitical tensions in the Middle East, as war-related rhetoric between the US and Iran heightened fears of a broader regional conflict, triggering widespread risk aversion," said Ali Najib, deputy head of trading at Arif Habib Ltd.

Adding to the pressure, Fauji Fertiliser Company’s (FFC) earnings announcement came in below market expectations, primarily due to margin compression, while the absence of a larger dividend (Rs15–20), stock split, or bonus issue, contrary to market speculation, deeply disappointed traders. This led to panic selling, with FFC hitting its lower circuit (-10%) and closing the day at the 596.62 level (-Rs. 65.81; down 9.93%).

Furthermore, likely institution-led across-the-board selling exacerbated losses, intensifying fears of further downside. FFC alone shaved 1,902 points from the index.

Moreover, blue-chip stocks, namely UBL, ENGROH, OGDC, HUBC, PPL, LUCK, SYS, HBL, and MARI, also came under heavy selling pressure, collectively dragging the index down by 2,116 points.

Despite the steep decline, market activity remained robust, with volumes at 925.5 million shares and turnover of PKR 66.2 billion.

KEL topped the volume chart, with 104.1m shares traded. Due to heavy selling pressure, the 185k (first support) was breached, with the KSE-100 Index touching an intra-day low of 181,961. Going forward, 180k now stands as a strong support, while a weekly close above 185k would signal a resumption of the bullish trend next week.