KARACHI:
Pakistan Stock Exchange (PSX) faced heavy selling on Wednesday as the KSE-100 index fell 1,690.40 points, or 0.96%, driven by persistent US-Iran conflict and concerns over energy supply through a vital chokepoint.
Commercial banks, cement and oil and gas exploration stocks bore the brunt of selling. The index moved between the intra-day high of 175,841.83 and the low of 174,562.88, remaining under pressure throughout the session. Earlier, the market opened on a sharply negative note, falling 1,663.16 points by 9:34 am.
The Middle East saw heightened geopolitical uncertainty in the wake of attacks by the US and Iran on each other, which sparked fresh concerns about oil and gas supply and the security of shipping through the strategically important Strait of Hormuz. International oil price movements further dampened the investor risk appetite.
The broader regional and global market backdrop also provided a negative cue to the local bourse. Asian and European stocks tumbled after US airstrikes pushed oil prices back to levels not seen since July, adding to worries about the economic impact of disrupted energy flows and the resulting inflationary pressure worldwide.
According to KTrade Securities, the KSE-100 index closed at 174,776.60, down 1,690 points, or 0.96%, day-on-day. Trading activity remained moderate while the market faced broad-based selling amid heightened volatility. Selling pressure was visible across commercial banks, cement, oil & gas and technology stocks.
Meezan Bank, United Bank, Pakistan Petroleum, Fauji Fertiliser, Lucky Cement, Oil & Gas Development Company and Habib Bank were among the key names weighing on market performance. The decline came amid a sharp rise in global oil prices, with crude gaining around 7% overnight, further pressuring sentiment and raising concerns over inflation and the broader macroeconomic outlook.
“Going forward, the market is likely to remain volatile and defensive as elevated oil prices and geopolitical uncertainty continue to weigh on investor sentiment. The 174,500-174,700 range will be important to watch for in the near term, while any de-escalation in geopolitical tensions or moderation in crude prices could trigger a rebound,” KTrade projected.
“The PSX remained under pressure amid renewed geopolitical uncertainty,” commented JS Global analyst Mubashir Anis Naviwala. Commercial banks were the biggest drags, contributing negative 555 points, followed by cement and oil & gas companies. Auto, investment banks and sugar & allied sectors provided limited support.
Overall, the session reflected cautious consolidation, where investors closely monitored geopolitical developments and their impact on market sentiment, he added.
Arif Habib Limited (AHL) Deputy Head of Trading Ali Najib wrote that market sentiment remained weak amid the resumption of US-Iran fighting over the Strait of Hormuz, triggering a fresh surge in oil prices as both sides exchanged strikes across the region. On the macro front, Pakistan planned to raise $2 billion through the Eurobond to repay bilateral loans to Saudi Arabia or China.
In terms of index contribution, Meezan Bank, United Bank, Pakistan Petroleum, Fauji Fertiliser, Lucky Cement, OGDC, Hub Power, HBL, Service Industries and Bank Alfalah collectively erased 912 points. “Going forward, selective profit-taking and stock-specific volatility are expected in the backdrop of the ongoing results season, while geopolitical developments and oil prices will remain the key market drivers,” he said.
Overall trading volumes decreased to 610.2 million shares compared with Tuesday’s total of 784.5 million. The value of traded shares stood at Rs31.9 billion.
In the ready market, shares of 501 companies were traded. Of these, 113 stocks rose, 356 fell and 32 remained unchanged.
Cnergyico Pk was the volume topper with trading in 124.9 million shares, falling Rs0.34 to close at Rs14.66. Foreign investors sold shares worth Rs710 million, the National Clearing Company reported.
