KSE-100 posts 9,000-point surge as markets bet on Iran war de-escalation

After a panic sell-off and market halt on Monday, the Pakistan Stock Exchange (PSX) staged a sharp rebound on Tuesday, with the KSE-100 Index surging more than 9,000 points at closing, mainly driven by hopes of possible de-escalation in the Middle East as US President Donald Trump signalled that the Iran war could end soon.

According to the PSX website, the market kick-started the session with bullish momentum, and the benchmark index touched 155,783.89 at 9:16 am, up 9,303.75 points, or 6.35%, from the previous close. At 9:22 am, trading was suspended as the market gained more than 5% from the previous close, triggering a halt under PSX rules.

“All TRE Certificate Holders are hereby informed that due to a 5% increase in the KSE-30 index from the previous trading day close of the same, a Market Halt has been triggered as per PSX Regulations and all equity-based markets have been suspended accordingly,” the PSX said in a notice. 

When trading resumed at 10:27 am, the benchmark index extended its rally, reaching the day's highest level of 158,354.12, a gain of 11,873.98 points.

Buying returned a day after heavy selling pressure pushed the market into one of its steepest declines in recent sessions. Gains were seen across major sectors, including automobile assemblers, cement, commercial banks, oil and gas exploration companies, oil marketing companies and power generation. Heavily weighted stocks such as ARL, HUBCO, MARI, OGDC, POL, PPL, HBL, NBP and UBL traded in positive territory.

At the end of the session, KSE-100 settled at 156,177.12, with an increase of 9696.98 points, or 6.62% from the previous close.

The rebound follows Monday’s broad sell-off, when rising tensions in the Middle East and volatility in global oil prices triggered sharp losses across the board. At the close of trade on Monday, the KSE-100 Index had fallen 11,015.95 points, or 6.99%, to 146,480.15.

Tuesday’s recovery also suggests investor sentiment improved after signs that regional conflict may ease, although market direction is likely to remain tied to developments in the Middle East and international energy markets.

Globally, Asian stocks rallied, and oil prices plunged at the start ​of trading on Tuesday, following a volatile overnight session after U.S. President Donald Trump declared the Middle East war could be “over soon.”

MSCI’s broadest index of Asia-Pacific shares outside Japan was up 2.6%, paring losses since the start of the conflict, while Brent crude futures fell as much as 10% to below $90 per barrel as trading resumed. U.S. equity futures were more muted, with S&P 500 e-mini futures down 0.2% to pare Monday’s ​rebound.

With investor confidence steadying after Monday’s selloff amid signs of increased risk-taking by retail ​investors, Japan’s Nikkei 225 jumped 3.6%, while South Korea’s Kospi surged 6.4%. The gains prompted the Korea Exchange to trigger a sidecar trading ​curb after futures rose more than 5%, halting programme trading for five minutes.

Oil ‌prices fell on Tuesday after hitting their highest level in more than three years in the prior session as U.S. President Donald Trump predicted the war in the Middle East could end soon, easing concerns about prolonged disruptions to global oil supplies.

Brent futures ​fell $6.51, or 6.6%, to $92.45 a barrel at 0018 GMT, while U.S. West Texas Intermediate (WTI) crude was ​down $6.12, or 6.5%, to $88.65.

Oil prices surged past $100 a barrel on Monday, hitting session highs ⁠of $119.50 for Brent and $119.48 for WTI, their highest since mid-2022, as supply cuts by Saudi Arabia and other ​producers during the expanding U.S.-Israeli war with Iran stoked fears of major disruptions to global supplies.

Prices later retreated ​after Russian President Vladimir Putin held a call with Trump and shared proposals aimed at a quick settlement to the Iran war, according to a Kremlin aide, easing concerns about a prolonged supply disruption.

Trump said on Monday in a CBS News interview that he thinks ​the war against Iran “is very complete” and that Washington was “very far ahead” of his initial four- to five-week estimated ​timeframe.