PSX falls over 1,500 points as Middle East tensions hit markets

Bears dominated the trading floor of the Pakistan Stock Exchange (PSX) on Thursday, with the benchmark KSE-100 Index losing over 1,500 points at the closing amid escalating tensions in the Middle East and rising oil prices.

According to the PSX website, the market opened on a negative note, and the benchmark index plunged over 2,000 points during the early minutes of trade. The market hit its day's lowest level of 150,728.17, down by over 3,400 points during the intraday trading. 

Major sectors came under strong selling pressure, including oil and gas exploration, oil marketing companies, power generation, refineries, automobile assemblers, cement, commercial banks and fertiliser. Index-heavy stocks such as ARL, HUBCO, MARI, OGDC, POL, PPL, HBL, MCB, MEBL and NBP traded lower.

Later, the market recovered some losses and the KSE-100 settled at 152,740.37, down 1551.88 points, or 1.01% compared to the last session. The decline followed a strong rally in the Wednesday session, when the index had closed at 154,292.26 points after gaining over 4,200 points.

The downturn aligned with global market trends, where equities declined and energy prices rose after Iran attacked several energy facilities in Qatar, UAE and Saudi Arabia, following a strike on ​its South Pars gas field, a major escalation in Tehran’s war with the US ‌and Israel.

Oil markets moved higher after reported strikes on energy infrastructure. U.S. crude increased about 1% to $97.07 per barrel, while Brent crude rose 4.5% to $112.19. Natural gas prices also climbed by more than 6%.

QatarEnergy said on Wednesday that Iranian missile attacks ​on Ras Laffan, the site of Qatar’s core LNG processing operations, caused “extensive damage” to its energy hub. ​The United Arab Emirates also shut some energy operations, responding to incidents at the Habshan gas facilities and the Bab oil field caused by falling debris from intercepted missiles.

Saudi Arabia, meanwhile, said it had intercepted and destroyed ​four ballistic missiles launched toward Riyadh on Wednesday and an attempted drone attack on a ​gas facility.

Asian equities recorded losses, with Japan’s Nikkei falling 2.5% and South Korea’s benchmark down 1.5%. MSCI’s Asia-Pacific index excluding Japan dropped more than 1.5%, while European futures were also lower.

The Bank of Japan kept its policy rate unchanged at 0.75%, joining other central banks in maintaining a cautious stance amid rising energy costs and inflation concerns linked to the conflict.