PSX suffers sharp sell-off as geopolitical fears wipe out nearly 3,800 points

Rising fears over widening conflict in the Middle East rattled investors at the Pakistan Stock Exchange (PSX) on Monday, triggering broad-based selling with the benchmark KSE-100 Index falling nearly 3,800 points.

According to the PSX website, the market opened lower, with the KSE-100 shedding more than 1,200 points within the opening minutes of trading. Selling pressure intensified during the session, and the index closed at 161,805.02, down by 3791.05 points, or 2.29% from the previous close.

Heavy selling was recorded across major sectors, including apparel, automobile assemblers, automobile parts & accessories, cement, chemical, commercial banks, fertiliser, oil and gas exploration companies, oil marketing companies, power generation and refinery stocks. 

Market analysts attributed the decline to escalating tensions in the Middle East and rising oil prices after the United Arab Emirates and Saudi Arabia reported renewed drone attacks, raising fears of a breakdown in the ceasefire.

Last week, the KSE-100 Index declined 5,519.75 points or 3.2% to close at 165,596.06 points as investor sentiment remained weak amid continued uncertainty linked to geopolitical tensions in the Middle East, despite improving domestic macroeconomic indicators.

Asian share markets were on the skids on Monday as fresh drone attacks in the Gulf shoved oil prices and bond yields higher, while the AI euphoria underpinning the tech bull run ​will be tested by earnings from Nvidia this week.

A drone strike caused a fire at a Barakah nuclear power plant in the United Arab Emirates, while Saudi Arabia reported intercepting three drones, ‌as U.S. President Donald Trump warned that Iran must act "fast" to reach a deal.

Meanwhile, the vital Strait of Hormuz remains closed to all but a trickle of shipping as Tehran tries to formalise its control of the waterway that during normal times carries 20% of the world's oil trade.

Japan's Nikkei eased 0.9%, having fallen 2% last week from record highs. South Korean stocks dipped 0.3%, though Samsung Electronics gained after a court issued a partial injunction against ‌a union ⁠strike.

MSCI's broadest index of Asia-Pacific shares outside Japan lost 0.8%. Chinese blue chips lost 0.6%, as economic data disappointed. China's April retail sales edged up 0.2% when analysts had looked for growth of 2.0%, while industrial output rose a sluggish 4.1%.

S&P 500 futures fell 0.6% and Nasdaq futures lost 0.7%. For Europe, EUROSTOXX 50 futures and DAX futures both fell 1.0%, while FTSE futures were flat.

Brent crude ​futures climbed $1.65, or 1.51%, to $110.91 a barrel by 0703 GMT, but were off the $112 they had touched ​earlier for their highest since May 5.