Selective buying helps PSX close in green

Index recovers from steep early losses caused by regional conflict, ends up by 125 points

KARACHI:

Pakistan Stock Exchange (PSX) endured another volatile session on Monday as escalating tensions in the Middle East kept investors on edge, although late-session buying helped the benchmark index erase steep early losses and end trading marginally higher.

The KSE-100 index settled at 175,927.74, gaining 124.95 points, or 0.07%, after swinging sharply throughout the session. It touched the intra-day high of 176,129.35 and the low of 173,636.46, reflecting heightened investor nervousness following latest military exchanges between the US and Iran.

The market opened on a weak footing, with the benchmark plunging nearly 2,000 points as geopolitical tensions escalated over the weekend. The conflict fuelled a risk-off mood across regional markets, while international oil prices advanced, prompting investors to trim exposure to equities. However, selling pressure eased gradually as investors took advantage of lower valuations to accumulate selected blue-chip stocks, which allowed the market to recover most of its losses.

"The market opened on a negative note amid concerns over escalating tensions between the US and Iran, with the benchmark index dipping to the intra-day low of 173,636," JS Global analyst Nawaz Ali observed. However, sentiment improved during the second half over expectations of a possible de-escalation, he said. "Going forward, we recommend investors to maintain a 'buy-on-dips' strategy as the market continues to demonstrate resilience at lower levels. Nevertheless, any further escalation in the Middle East could dampen investor sentiment and weigh on overall market performance," Ali added.

Ahmed Sheraz, equity trader at KTrade Securities, said the KSE-100 started the week on a highly volatile note, where investors remained cautious amid escalating geopolitical tensions in the Middle East. He noted that the benchmark reacted sharply to the latest developments, including the US strikes on Iranian infrastructure and Iran's retaliatory attacks targeting US bases in the region.

"Despite the heightened uncertainty, the market staged a recovery from its intra-day lows and closed in positive territory, reflecting resilience despite the volatile backdrop," he said. Looking ahead, Sheraz expected investor sentiment to remain closely tied to geopolitical developments in the coming sessions. Any further escalation or signs of de-escalation are likely to influence market direction, while the start of corporate earnings season could provide stock-specific triggers.

Ali Najib of Arif Habib Limited (AHL) said the market remained highly volatile as investors reacted to the rising geopolitical risks stemming from the latest confrontation between the US and Iran. He noted that after the KSE-100 touched the intra-day low of 173,636, value hunters emerged to accumulate fundamentally strong stocks at attractive valuations, helping stabilise sentiment and enabling the index to end the session in positive territory.

Najib said United Bank, Systems Limited, Engro Holdings, Attock Refinery and Cnergyico Pk collectively contributed 367 points to the index. Overall trading volumes increased to 675.9 million shares against Friday's total of 621 million. The value of traded shares stood at Rs30.3 billion.

In the ready market, shares of 492 companies were traded. Of these, 165 stocks closed higher, 277 decreased and 50 remained unchanged.

Cnergyico Pk was the volume leader with trading in 166 million shares, rising Rs0.8 to close at Rs10.61. Foreign investors bought shares worth Rs175 million, the National Clearing Company reported.