Weekly wrap-up: PSX ends week 3,600 pts lower over oil surge, Gulf tensions

KARACHI: The Pakistan Stock Exchange (PSX) saw a turbulent week, with the benchmark KSE-100 index finishing at 153,866 points, down 3,630 points or 2.3 per cent week-on-week, as rising global oil prices and escalating US-Iran tensions weighed on market sentiment.

The week opened sharply in the red, with the index plummeting 11,016 points (-6.99 per cent) on Monday to 146,480, marking the second-largest single-day point drop in PSX history. However, the market bounced back on Tuesday, gaining 9,697 points (+6.62 per cent) to close at 156,177, registering the second-highest point gain ever recorded. Midweek trading was mixed, with the KSE-100 slipping 319 points (-0.20 per cent) on Wednesday to 155,858, before retreating 1,437 points (-0.92 per cent) to 154,421 on Thursday. The week ended with subdued trading, with the index falling 555 points (-0.36 per cent).

According to an article published by Express Tribune, Arif Habib Limited (AHL) noted that Monday’s sharp drop was largely driven by a surge in crude oil prices amid regional tensions, though the market regained some ground later in the week. Overall, the KSE-100 lost 2.3 per cent week over week (-3,630 points) from last Friday’s close.

On the macroeconomic front, the State Bank of Pakistan (SBP) maintained its policy rate at 10.5 per cent, citing heightened uncertainty from the Middle East conflict and volatile commodity prices. Meanwhile, petroleum sales rose 13 per cent YoY to 1.28 million tons in February, driven by higher motor spirit and high-speed diesel demand, though monthly sales fell 15 per cent MoM due to Ramadan-related slowdown and fewer days in the month. Cumulative sales for the first eight months of FY26 rose 4 per cent to 10.96 million tons.

Analysts noted that the ongoing geopolitical tensions continued to weigh on investor sentiment, pushing the KSE-100 down nearly 19 per cent from its January 2026 peak of 189,167. Market activity remained volatile, with investors cautious ahead of upcoming macroeconomic developments.

The IMF, in its end-of-mission statement on Pakistan’s third Extended Fund Facility (EFF) review, highlighted progress in discussions while noting the economy’s vulnerability to global developments, particularly energy prices.