PSX loses 699 points over spreading ME war

Investors remained jittery at the Pakistan Stock Exchange (PSX) on Wednesday as the spreading Middle East war sparked caution, which pulled the KSE-100 index down by 698.56 points, or 0.40%, at close.

The market moved within a broad range, hitting the high of 173,174.19 and slipping to the low of 171,801.67. Stock selling intensified in the final hours, dragging the index further into negative territory.

Market mood was influenced by the continuing US-Iran conflict, with escalating attacks on military, shipping and energy assets, fuelling concerns of wider regional instability and a fresh rise in crude oil prices. Investors remained wary of the potential economic fallout from disruptions to energy supplies.

According to Ahmed Sheraz, equity trader at KTrade Securities, the KSE-100 index closed at 171,943.60, down 698.56 points, or 0.40% with trading in approximately 159 million shares.

The trading session remained mixed, where selling pressure was primarily witnessed across commercial bank, cement and fertiliser sectors. Among individual stocks, Fauji Fertiliser, MCB Bank, Lucky Cement, Meezan Bank and other index-heavy names shed value, while selective buying lent some support to the broader market.

Looking ahead, investors are likely to remain cautious amid heightened geopolitical uncertainty, as Brent crude crossed the $100-per-barrel mark following an overnight escalation between the US and Iran, while shipping traffic through the Strait of Hormuz remained disrupted.

"The sharp rise in oil prices, coupled with ongoing geopolitical tensions, could continue to weigh on Pakistan's external account and inflation outlook, keeping the PSX sensitive to further developments in the coming sessions," Sheraz noted.

JS Global analyst Mubashir Anis Naviwala observed that the KSE-100 index traded cautiously and touched the intra-day low of 171,801.67. Selling pressure became more visible towards the closing hours. Commercial banks, cement and fertiliser firms were the key drags on the index. Some support came from miscellaneous, chemical and automobile sectors. Overall, the sentiment remained cautious amid renewed geopolitical uncertainty, he added.

"Market sentiment stayed subdued amid geopolitical uncertainty following fresh attacks across the Middle East. International oil prices continued to strengthen, with WTI at $94.97 (+1.9%) and Brent at $100.40 (+2.46%) in the evening," commented Ali Najib, Deputy Head of Trading at Arif Habib Limited (AHL).

On the macro front, Pakistan's remittances increased 17% year-on-year to $3.7 billion in August, while 2MFY27 inflows rose 15% to $7.3 billion. Pakistan Services, UBL, Oil & Gas Development Company, Lucky Core and Sazgar Engineering collectively added 269 points to the benchmark index, while FFC, MCB Bank, Lucky Cement, Meezan Bank and Mari Energies erased 411 points amid selective profit-taking.

Najib wrote that market activity was likely to remain volatile over expectations of selective profit-taking and stock-specific moves amid the current corporate result season. "Geopolitical developments and elevated oil prices will be the key drivers of market direction."

Cumulatively, trading volumes decreased to 477.7 million shares compared with Tuesday's total of 722.6 million. The value of traded shares stood at Rs22.6 billion.

In the ready market, shares of 492 companies were traded. Of these, 162 stocks closed higher, 293 fell and 37 remained unchanged.

Cnergyico Pk topped the volumes with trading in 65.8 million shares, losing Rs0.26 to close at Rs13.06. Foreign investors bought shares worth Rs84.5 million, the National Clearing Company reported.