Benchmark index slides 1.3% as fears over Middle East conflict and oil supply risks fuel broad-based selling
KARACHI: Pakistan’s benchmark KSE-100 Index fell sharply on Friday, shedding 2,320 points, or 1.3%, as escalating tensions between the United States and Iran prompted investors to reduce exposure to equities amid growing concerns over regional stability and global energy supplies.
The Pakistan Stock Exchange (PSX) benchmark closed at 175,803 points, extending losses after reports that Washington and Tehran had intensified attacks beyond military targets, raising fears of a broader conflict in the Middle East.
Investor concerns were further heightened by the lack of any breakthrough over the Strait of Hormuz, one of the world’s most critical oil shipping routes, increasing uncertainty over global crude supplies and the potential impact on energy prices.
Geopolitical concerns dominate trading
The benchmark index remained under pressure throughout the trading session as investors adopted a risk-averse stance in response to rising geopolitical uncertainty.
Analysts said concerns that prolonged hostilities could disrupt global oil markets weighed heavily on sentiment, particularly given Pakistan’s dependence on imported energy and the potential implications for inflation and the external account.
The broad-based decline erased gains across several major sectors, with blue-chip stocks leading the market lower.
Heavyweight stocks lead decline
Among the biggest contributors to the benchmark’s losses were:
Engro Holdings (ENGROH) Systems Limited (SYS)
United Bank Limited (UBL) Oil and Gas Development Company (OGDC)
Pakistan Petroleum Limited (PPL)
Together, these heavyweight stocks shaved approximately 694 points off the KSE-100 Index.
Trading activity remains resilient
Despite the market’s decline, trading activity remained relatively strong.
Investors traded 618 million shares during the session, with the total traded value reaching Rs29.8 billion.
By traded value, OGDC led the market with transactions worth Rs1.6 billion, followed by:
Fauji Fertilizer Company (FFC): Rs1.3 billion
Engro Holdings (ENGROH): Rs931 million
National Bank of Pakistan (NBP): Rs906 million
Attock Refinery Limited (ATRL): Rs872 million
The healthy trading volumes indicated continued investor participation despite heightened volatility.
Outlook
Market participants are expected to closely monitor developments in the Middle East, particularly the evolving US-Iran conflict and any changes affecting shipping through the Strait of Hormuz.
Analysts said further escalation could keep global oil prices elevated, increasing pressure on Pakistan’s inflation outlook and external finances, while any signs of diplomatic progress may help restore investor confidence in the coming trading sessions.