Stocks tumble 1,690 points as US-Iran tensions trigger sell-off

Index slips below 175,000 amid broad-based selling in key sectors

KARACHI:

Pakistan Stock Exchange (PSX) came under a heavy wave of selling on Wednesday, with the index plunging 1,690.40 points, or 0.96%, to settle at 174,776.60 as escalating United States-Iran tensions and renewed concerns over energy supplies rattled investor sentiment. Commercial banks, cement and oil and gas exploration stocks bore the brunt of the sell-off.

The index moved between an intraday high of 175,841.83 and a low of 174,562.88, remaining under pressure throughout the session.

Market sentiment remained subdued amid heightened geopolitical uncertainty, as escalating tensions between the US and Iran raised fresh concerns over energy supplies and the security of shipping through the strategically important Strait of Hormuz.

Oil price movements further dampened investor risk appetite as renewed US-Iran strikes intensified fears of supply disruptions and prolonged instability in the Middle East.

The broader regional and global market backdrop also remained weak. Asian and European stocks tumbled after renewed US airstrikes pushed oil prices back to levels not seen since July, adding to concerns over the economic impact of disrupted energy supplies and the resulting inflationary pressures worldwide.

The market had opened on a sharply negative note, with the KSE-100 index falling 1,663.16 points, or 0.94%, to 174,803.83 by 9:34am. The index briefly recovered some ground during the session. At 1:04pm, it was trading at 175,291.75, down 1,175.24 points, or 0.67%, before renewed selling pushed the index lower towards the close.

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Investors remained cautious as higher oil prices could add to import costs and inflationary pressures, while uncertainty surrounding shipping through the Strait of Hormuz continued to weigh on risk appetite.

According to KTrade Securities, the KSE-100 index closed at 174,776 points, down 1,690 points or 0.96% day-on-day. Trading activity remained concentrated as the market witnessed broad-based selling amid heightened volatility.

Selling pressure was visible across commercial banks, cement, oil and gas, and technology stocks. Meezan Bank, United Bank, Pakistan Petroleum, Fauji Fertiliser, Lucky Cement, Oil and Gas Development Company and Habib Bank were among the key names weighing on market performance.

The decline came amid a sharp rise in global oil prices, with crude gaining around 7% overnight, further pressuring sentiment and raising concerns over inflation and the broader macroeconomic outlook. 

Going forward, the market is likely to remain volatile and defensive as elevated oil prices and geopolitical uncertainty continue to weigh on investor sentiment. The 174,500–174,700 area will be important to watch in the near term, while any de-escalation in geopolitical tensions or moderation in crude prices could trigger a relief rebound, KTrade expected.

Overall, trading volume decreased to 610.1 million shares compared with Tuesday’s total of 784.4 million. The value of traded shares stood at Rs31.8billion. In the ready market, shares of 501 companies were traded. Of these, 113 rose higher, 356 fell, and 32 remained unchanged. Cnergyico Pk was the volume topper with trading in 124.9 million shares, falling Rs0.34 to close at Rs14.66.