PSX rises on hopes of peace talks success

KSE-100 index adds 466 points; late-session recovery lifts sentiment

KARACHI:

The Pakistan Stock Exchange (PSX) closed slightly higher on Tuesday, supported mainly by strength in the banking sector, though the trading session remained highly volatile.

At the commencement of trading, selling pressure gripped the market as investor sentiment turned sharply negative amid geopolitical uncertainty. Concerns linked to US President Donald Trump's aggressive rhetoric and delay in ceasefire weighed heavily on equities, triggering a steep decline.

However, the market staged a recovery later in the day on expectations that Pakistan's diplomatic efforts may bring positive outcomes. During the session, the KSE-100 index touched the intra-day high of 152,013 and low of 149,129. At close, the index displayed an increase of 465.64 points, or 0.31%, to settle at 151,673.46. Trump's warmongering kept global markets on edge, contributing to heightened volatility and investor caution. Analysts noted that despite the late-session recovery at the PSX, volatility may persist and investors should adopt a cautious "wait-and-watch" approach in the near term.

AKD Securities Director Research Mohammed Awais Ashraf told The Express Tribune that the KSE-100 index remained under pressure since the opening bell as jitters over potential escalation in the Middle East war and the looming deadline for a deal kept investors on the sidelines. "Investors are anticipating a positive development and the market is likely to recover losses," he said. "Resolution of the Middle East conflict remains the key to investor decision-making. We expect the market to rebound following the cessation of hostilities while investor focus will shift to Pakistan's macroeconomic situation," he added.

Arif Habib Limited (AHL) noted in its report that Tuesday saw additional gains, where the KSE-100 rose 0.31%, though it again registered the intra-day decline below the 150k level. Some 50 shares rose while 47 fell with UBL (+2.95%), HBL (+1.75%) and Fauji Fertiliser Company (+0.62%) contributing the most to the index gains. In contrast, Bank Alfalah (-1.98%), National Bank (-1.47%) and Engro Fertilisers (-0.73%) were the biggest index drags.

In diplomatic moves, talks among Egyptian Foreign Minister Badr Abdelatty, US Special Envoy Steve Witkoff and the foreign ministers of Iraq and Pakistan focused on efforts to ease tensions and help the United States and Iran reach a settlement.

"Wednesday should see significant moves in global markets as we will know whether the warring sides in the Middle East reach a ceasefire deal or move towards escalation," AHL said.

KTrade Securities, in its market wrap, observed that the KSE-100 index closed up 466 points in a range-bound and cautious session. The market opened mixed, tracking regional uncertainty and elevated oil prices, with Brent crude near $111 per barrel.

Sentiment improved modestly after reports about Pakistan's last-ditch mediation efforts while oil eased towards $108, providing some relief. The session remained choppy, with the index swinging between gains and losses before settling slightly higher at close.

Support came primarily from commercial banks and select blue chips including United Bank, Habib Bank, MCB Bank, Meezan Bank, Fauji Fertiliser, Systems Limited and Lucky Cement. Volumes stayed muted, reflecting limited conviction as investors largely remained on the sidelines or booked mild profits, KTrade said. Overall trading volumes fell to 357.27 million shares compared to Monday's tally of 457.21 million. The value of traded shares stood at Rs20.4 billion.

Shares of 477 companies were traded. Of these, 223 stocks closed higher, 188 fell and 66 remained unchanged.

K-Electric was the volume leader with trading in 53.6 million shares, falling Rs0.12 to close at Rs6.99. It was followed by Trust Brokerage with 26.4 million shares, rising Rs0.07 to close at Rs1.45 and Cnergyico PK with 16.7 million shares, gaining Rs0.04 to close at Rs7.25. Foreign investors bought shares worth Rs394.9 million.