PSX sheds over 630 points in intraday trading as selling pressure persists

The Pakistan Stock Exchange (PSX) began the week on a subdued note on Monday, as selling pressure emerged shortly after the opening bell, with investors remaining reluctant to take fresh positions amid persistent market uncertainty. The benchmark index slipped into negative territory despite easing international geopolitical concerns and a decline in global oil prices.

The market came under pressure in early trading, with the KSE-100 index falling to 166,169.41 points at 9:34am, down 239.84 points, or 0.14 per cent, reflecting weak buying interest as selling in key sectors continued to weigh on investor sentiment.

The downward momentum persisted through the morning session, with the benchmark KSE-100 index trading at 165,776.85 points at 12:29pm, registering a decline of 632.40 points, or 0.38pc, against the previous closing level of 166,409.25 points.

The weakness came despite a softer international oil market, where crude prices retreated as renewed diplomatic efforts to end the US-Israeli war on Iran offered some relief to global investors. Iranian and Qatari officials held a third consecutive day of talks aimed at reaching an agreement, while the absence of any significant military escalation over the weekend eased immediate concerns over further disruptions to regional energy supplies.

The benchmark index touched an intraday high of 166,581.95 points and a low of 165,601.22 points, reflecting continued volatility during the session. Trading volume stood at 101.08 million shares, while the traded value was recorded at Rs6.31 billion.

Internationally, lingering hopes of diplomatic progress, coupled with the absence of any meaningful military escalation over the weekend, provided some respite to financial markets. However, the improvement in external sentiment failed to translate into sustained buying interest at the local bourse, where investors remained cautious about taking fresh positions.

The latest decline followed a weak close to the previous trading week, when the benchmark KSE-100 index shed 784.19 points, or 0.47pc, to settle at 166,409.25 points on Friday. The downturn interrupted a four-session recovery, as investors opted to book profits amid renewed concerns over rising oil prices, developments in the Strait of Hormuz and uncertainty surrounding the Middle East conflict.

Read: Oil falls as diplomacy hopes outweigh Middle East escalation fears

The broader market had also remained under pressure throughout October. The KSE-100 index lost 3,560 points, or approximately 2.1pc, during the month, weighed down by geopolitical uncertainty, foreign portfolio outflows, profit-taking in heavyweight shares and cautious investor sentiment.

Despite a recovery of more than 4,800 points during the final week of October, which briefly pushed the benchmark above the 167,000-point level, the market was unable to sustain its gains as investors remained concerned about global developments and domestic economic conditions.

Geopolitical tensions have remained a significant influence on the local equity market, particularly because of Pakistan's dependence on imported energy. Earlier, the PSX witnessed sharp selling pressure as escalating Middle East tensions and higher international oil prices raised concerns over the country's energy import bill, inflationary pressures and external account.

Meanwhile, the State Bank of Pakistan increased its benchmark policy rate by 50 basis points to 12pc on October 26, citing heightened energy prices and geopolitical uncertainty affecting the domestic inflation outlook. The development added another consideration for investors already assessing corporate earnings, monetary conditions and the broader economic outlook.

Against this backdrop, market participants continue to closely monitor diplomatic developments in the Middle East, movements in international crude oil prices and domestic economic indicators for clearer signals on the direction of equities in the coming sessions.