PSX plunges over 4,500 points on US-Iran talks breakdown

Oil prices surge past $104 per barrel as Trump announces blockade on Strait of Hormuz

KARACHI:

The Pakistan Stock Exchange (PSX) plunged on Monday in a subdued trading environment, as heavy selling pressure took a toll on market sentiment. The benchmark KSE-100 Index fell sharply by 5,353.67 points at the outset of trading. Visible fluctuations persisted in the market, with the benchmark KSE-100 Index dropping 4,567.31 points (-2.73%) to 162,624.06 by 10:29am.

Despite intra-day volatility, the benchmark index showed signs of recovery as the bourse trimmed some losses to 4,450.97 points (-2.66%), with the index improving to 162,740.40 at 12:49pm, indicating a modest rebound in market sentiment.

The index came under intense pressure after Islamabad hosted talks between the United States and Iran. As the parties failed to come to an agreement, a sharp surge was seen in global oil prices, with crude benchmarks jumping over 7% to exceed $100 per barrel. This also followed US President Donald Trump’s announcement of a blockade on maritime traffic to and from Iranian ports via the Strait of Hormuz.

Read: PSX surges 11% on Middle East ceasefire

KTrade Securities Equity Trader Ahmed Sheraz told The Express Tribune that the KSE-100 Index opened sharply lower, falling 5,353 points (-3.2%), as investor sentiment turned cautious amid no deal reached in the Pakistan-brokered peace talks. The lack of immediate clarity and continuation of negotiations weighed on confidence. Meanwhile, escalating uncertainty lifted global oil prices to $104/bbl, adding further pressure on equities.

Market conditions are expected to remain volatile in the near term, driven by evolving geopolitical developments and elevated oil prices; however, the broader outlook remains constructive, as both the US and Iran have indicated their intent to uphold the ceasefire. The next key catalyst will be the second phase of negotiations, with reports suggesting that Qatar and Switzerland have expressed willingness to host the talks, Sheraz observed.