Geopolitical uncertainty triggers broad-based selling as Pakistan equities extend losing streak
KARACHI: The benchmark KSE-100 Index of the Pakistan Stock Exchange (PSX) fell sharply on Friday, dropping 2,475 points to close at 178,923 points, reflecting a decline of 1.36 per cent as escalating geopolitical tensions weighed heavily on investor sentiment.
The KSE-100 Index opened on a relatively stable note but came under intense selling pressure during the second half of the trading session, erasing early gains and extending its recent losing streak. Market participants said the decline in the KSE-100 Index was driven by renewed uncertainty in global geopolitics, particularly developments in the Middle East.
Middle East tensions shake investor confidence
Sentiment surrounding the KSE-100 Index weakened after reports that planned negotiations between the United States and Iran in Switzerland had been postponed. The talks were expected to focus on a permanent peace agreement and Iran’s nuclear programme.
Additional pressure on the KSE-100 Index came from escalating clashes in southern Lebanon between Israel and the Iran-backed Hezbollah group, raising fears of further regional instability. Analysts said these developments increased risk aversion and prompted investors to exit equities.
Heavyweight stocks drag KSE-100 Index lower
The decline in the KSE-100 Index was led by major heavyweight stocks including UBL, FFC, ENGROH, PPL, OGDC, LUCK, HBL and SYS, which collectively contributed to a significant portion of the losses.
Selling in energy, banking and fertiliser sectors particularly weighed on the KSE-100 Index, reflecting broad-based caution across the market.
Trading activity remains strong despite fall
Despite the sharp drop in the KSE-100 Index, market participation remained robust. HUBC led in traded value with Rs3.2 billion, followed by OGDC, PPL, SSGC and SNGP, indicating continued investor engagement even during volatility.
Overall trading volume reached 1 billion shares, while total traded value stood at Rs54 billion.
Analysts warn of continued volatility
Market analysts said the fall in the KSE-100 Index reflects growing sensitivity to geopolitical developments, particularly in energy-producing regions. They added that uncertainty over diplomatic negotiations continues to drive short-term volatility.
Investors are expected to closely monitor international developments, as further escalation in geopolitical tensions could keep pressure on the KSE-100 Index in upcoming sessions.
