PSX rebounds as easing geopolitical tensions lift investor sentiment

Easing geopolitical tensions brought buyers back to the Pakistan Stock Exchange (PSX) on Tuesday after Iran and Israel announced a halt to attacks following an appeal from US President Donald Trump, although both sides warned that hostilities could resume. 

According to the PSX website, the market opened on a strong note, with the KSE-100 Index surging more than 2,000 points in early trading to reach an intraday high of 171,022.94, and maintained most of its gains as the session progressed.

Widespread buying was recorded in major sectors, including automobile assemblers, cable & electrical goods, cement producers, engineering, commercial banks, exchange-traded funds, fertiliser companies, oil and gas exploration firms, oil marketing companies, and refineries.

At close, the index settled at 170,330.56, with an increase of 1,376.86 points or 0.81% from previous close.

The recovery followed selling pressure on Monday, when renewed attacks between Iran and Israel and reduced expectations of an immediate diplomatic breakthrough affected investor sentiment.

Geopolitical uncertainty pushed the KSE-100 below the 170,000-point level for the first time since May 22, 2026. The index closed Monday’s session at 168,953.71 points.

Global stocks rallied on Tuesday as investors rushed to buy the latest ​dip in tech stocks, while oil prices fell after Israel and Iran agreed to halt attacks on one another for now.

In Europe, ‌the STOXX 600 edged up 0.5%, led by tech heavyweights ASML and Infineon. U.S. stock futures rose 0.4% to 0.6%, as a broad range of shares gained in pre-market trading, including Nvidia, Eli Lilly and Goldman Sachs, all of which were up around 0.6%.

Excitement about artificial intelligence was front and centre, with ChatGPT maker OpenAI confidentially filing for a U.S. initial public offering ​on Monday, days before SpaceX's hotly anticipated market debut this week.

Oil prices also fell on Tuesday, ‌erasing most of the previous session's gains, after Iran and Israel said they had halted attacks on each other following an appeal from U.S. President Donald Trump, though both sides warned they could resume hostilities.

Brent ​crude futures were down $1.33, or 1.4%, at $92.92 a barrel at 0741 GMT, while ​U.S. West Texas Intermediate declined $1.73, or 1.9%, to $89.57 a barrel.

The price of oil has retreated from late April's four-year high of $126, but it is still nearly 30% higher than where it was in late February, ​while futures for the delivery of crude in six months' time are 21% above those levels.