Key Takeaways
- Pakistan Stock Exchange (PSX) began the week with a significant drop.
- KSE-100 index closed down 2,314.73 points from the previous close.
- Market sentiment dampened due to US-Iran exchanges and renewed fighting.
The Pakistan Stock Exchange (PSX) opened the week with a significant downturn, as the KSE-100 index fell by 2,314.73 points from its previous close of 182,241.77 to end at 179,927.04 points.
The initial drop was exacerbated by ongoing hostilities in the Middle East, particularly after the US and Iran exchanged fresh strikes, reigniting concerns over a broader regional conflict. This led to an increase in oil prices by more than three per cent on Monday.
Mettis Global and Topline Securities Ltd highlighted that the market sentiment remained under pressure due to these events, which pushed international crude oil prices higher and triggered a risk-off sentiment across the market.
Awais Ashraf, director of research at AKD Securities, noted that investor sentiment had been dampened amid escalating attacks between the US and Iran. He stated, 'The fighting has reduced traffic through the Strait of Hormuz to a five-week low and cast doubt on the future of the interim peace agreement signed last month.'
Despite the overall negative trend, heavyweight stocks contributed most to the early decline at the KSE-100, falling in the range of 1–1.7 per cent. However, the refinery sector remained positive due to expectations of an upcoming refinery policy that is expected to pave the way for much-needed upgrades and expansions.
Trading activity was subdued with a total traded volume of 845 million shares, while traded value stood at Rs35.5 billion. CNERGY topped the volume chart, with 158 million shares changing hands.
On Friday, value-hunting helped the stock market reverse a three-session losing streak amid growing geopolitical concerns in the Middle East and the potential fallout on the global economy from an oil supply disruption, which is fuelling inflationary pressure in countries reliant on supplies from the Strait of Hormuz.
'The decline was further exacerbated by broad-based profit-taking following the market’s recent rally, as investors opted to lock in gains despite an otherwise supportive macroeconomic backdrop.'
Topline Securities Ltd, Brokerage house
'The fighting has reduced traffic through the Strait of Hormuz to a five-week low and cast doubt on the future of the interim peace agreement signed last month.'
Awais Ashraf, Director of research at AKD Securities
