The Pakistan Stock Exchange (PSX) came under renewed selling pressure on Tuesday as escalating tensions in the Middle East unsettled investors and rising oil prices intensified concerns over the domestic economic outlook.
The benchmark KSE-100 Index closed at 172,642.16 points, down 993.91 points, or 0.57%, from the previous session’s 173,636.07 points. The index remained volatile throughout the trading session, touching an intraday low of 171,490.63 points before recovering some of its losses.
Market sentiment weakened as the conflict involving the United States, Iran and Iran-backed groups showed signs of further escalation. The latest Houthi attacks on Saudi Arabian cities and energy infrastructure added to concerns about disruptions to regional oil supplies and shipping routes.
Oil prices moved closer to the $100-a-barrel mark, raising fears that prolonged geopolitical instability could increase Pakistan’s import bill and fuel inflationary pressures. Brent crude reached around $99 during Tuesday’s trading session, while US crude also climbed sharply.
Analysts said elevated energy prices and uncertainty surrounding the duration of the conflict were discouraging fresh investment and encouraging profit-taking across the market. Lower trading volumes also reflected cautious investor positioning.
The sell-off follows another difficult session on Monday, when the KSE-100 dropped more than 1,600 points, highlighting the growing sensitivity of Pakistani equities to developments in global energy markets and regional security.
Investors are now closely watching developments in the Middle East, particularly the risk of further disruption around the Strait of Hormuz. Any sustained rise in crude prices could place additional pressure on Pakistan’s external account and inflation outlook.
With geopolitical risks remaining elevated, market participants are expected to remain cautious in the coming sessions as they assess the potential economic fallout of the widening conflict.