PSX slides 2,500 points in early trade as Iran stance dents risk appetite

The benchmark KSE-100 Index opened sharply lower on Thursday, falling nearly 2,500 points in early trading as investors turned cautious following Iran’s rejection of a US-backed ceasefire proposal in the Middle East conflict.

By 11:45am, the index was recorded at 155,813.97 points, down 2,499.47 points, or 1.58%, reflecting widespread selling across major sectors.

Losses were concentrated in index-heavy stocks spanning commercial banking, oil and gas exploration, cement, automobile assembly, oil marketing and power generation. Shares of MCB Bank Limited, Meezan Bank Limited, National Bank of Pakistan, Mari Petroleum Company Limited, Oil and Gas Development Company Limited, Pakistan Petroleum Limited, Pakistan Oilfields Limited, Pakistan State Oil and Hub Power Company were among the major laggards.

Investor sentiment weakened after reports that Iran had set strict conditions for any ceasefire, including demands for international recognition of its sovereignty over the Strait of Hormuz, signalling that a negotiated settlement to the conflict may remain distant.

The decline followed a strong rebound in the previous session. On Wednesday, the KSE-100 Index advanced 4,347.08 points, or 2.82%, to settle at 158,313.45 points, supported by improved risk sentiment linked to diplomatic developments and softer global oil prices.

Global markets showed mixed performance as investors navigated heightened geopolitical uncertainty. Japan’s Nikkei 225 rose 0.6%, while South Korean equities fell 1.2%. The MSCI Asia-Pacific Index ex-Japan edged 0.23% lower and remained on track for an 8.7% monthly decline, its steepest fall since October 2022.

Currency markets reflected a defensive posture, with the US dollar holding near recent highs and on course for a roughly 2% monthly gain, underscoring demand for safe-haven assets amid ongoing market volatility.