PSX rallies over 5,400 points as easing US-Iran tensions lift global sentiment

KARACHI: The Pakistan Stock Exchange (PSX) witnessed a strong rally on Tuesday, with the benchmark KSE-100 Index surging 5,448 points, or 3.13 per cent, to close at 179,335 points amid easing geopolitical tensions, declining international oil prices and improved investor sentiment.

The local index closed at 179,335.25 points, gaining 5,448.56 points from its previous close of 173,886.69 points. During the trading session, it touched an intraday high of 179,424 points.

The rally marked a strong return of buying activity after the long weekend, with the stock market remaining closed on Monday on account of Iqbal Day.

The buying momentum followed US President Donald Trump’s remarks that further US military action against Iran was not necessary at this stage, raising hopes of a de-escalation in the Middle East conflict.

The development eased concerns over potential disruptions to oil supplies from the region and helped push international crude prices lower, improving sentiment in global financial markets.

According to Reuters, global stocks advanced on Tuesday as Brent crude prices fell amid hopes of progress towards negotiations between Washington and Tehran.

Brent crude futures had declined by around 4.65 per cent on Monday, while US West Texas Intermediate (WTI) crude fell 3.51 per cent, reflecting reduced concerns over further escalation.

Broad-based buying across sectors

The rally was supported by buying across major sectors, including automobile assemblers, cement, commercial banks, oil and gas exploration companies, oil marketing companies and power generation.

Index-heavy stocks, including Mari Energies, Oil and Gas Development Company (OGDC), Pakistan Petroleum Limited (PPL), Pakistan State Oil (PSO), Hub Power Company (HUBCO), Habib Bank Limited (HBL), MCB Bank, Meezan Bank and United Bank Limited (UBL), traded in positive territory.

Earlier, the index had gained nearly 5,171 points, or 2.97 per cent, by 3:15pm, with strong buying across these key sectors.

Saad Hanif of Ismail Iqbal Securities told Business Recorder that the rally reflected a repricing of risk in the market, as easing geopolitical tensions reduced the risk premium on Pakistani equities.

He said lower oil prices could also improve Pakistan’s import bill, current account and inflation outlook, potentially creating room for monetary easing if the trend continued.

Remittances provide additional support

Improved external-sector indicators also added to the positive sentiment.

Workers’ remittances rose 13.8 per cent year-on-year to $3.892 billion in October 2026, providing further support to expectations about the country’s external account position.

The latest rally followed a strong performance last week, when the KSE-100 Index gained 7,477.44 points, or 4.5 per cent, to close at 173,886.69 points. It was the benchmark’s strongest weekly performance in nearly six months.

Global markets also advance

The positive trend was not limited to Pakistan, as Asian and other international markets also recorded gains amid easing concerns over the Middle East conflict and falling oil prices.

Reuters reported that South Korea’s KOSPI advanced 4.4 per cent and Japan’s Nikkei gained 2.9 per cent, while European markets also opened higher.

Investors were meanwhile awaiting US inflation data, which could influence expectations about the Federal Reserve’s future interest rate decisions.