Pakistan stocks early gains washed out amid Middle East conflict jitters

KARACHI: The Pakistan Stock Exchange’s benchmark KSE-100 Index opened Thursday’s session on a strong note, buoyed by news that the federal cabinet had approved a financial restructuring plan aimed at slashing Rs1.275 trillion in circular debt from the power sector over the next six years.

Riding on this optimism, the index surged by as much as 1,279 points during intraday trade. However, the bullish momentum faded quickly as profit-taking emerged later in the session, in line with global market trends, Topline Securities reported.

The index ultimately lost 463.34 points, or 0.38 per cent, to close at 120,002.59.

“Rising geopolitical tensions—particularly the intensifying standoff between Iran and Israel—dampened investor sentiment and triggered a broad-based pullback, overshadowing the earlier euphoria and underlining the fragility of market confidence in a volatile global environment,” Topline Securities added.

“Stocks closed lower on fears of escalating Middle East tensions, a weakening rupee, and a slump in global equities, all of which triggered panic selling at the PSX,” said Ahsan Mehanti, CEO of Arif Habib Commodities.

Also read: Stocks drop, oil gains as Mideast unrest fuels inflation fears

On the upside, index-heavyweights UBL, BAHL, MCB, and HMB provided support, jointly adding 203 points. However, losses in PKGP, EFERT, ENGROH, and LUCK collectively dragged the index down by 270 points.

“The benchmark index ended in the red after a volatile session, as persistent geopolitical tensions and fluctuating international oil prices continued to weigh on investor sentiment,” Ismail Iqbal Securities noted.

Market activity remained robust, with volumes hitting 598 million shares and total traded value amounting to Rs20.3 billion. WTL led the volume charts with 64 million shares traded.

In the previous session, the market had extended its slump from the day before, hitting an intraday low of 120,417 points—down 1,553 points—amid mounting geopolitical stress and oil price volatility.