The Pakistan Stock Exchange (PSX) experienced a steep decline on Monday, triggered by investor unease following the collapse of negotiations between the United States and Iran. Heavy selling pressure dominated the opening session, pushing the KSE-100 Index down by over 5,300 points at the start of trading.
Throughout the day, the market showed some volatility but losses remained substantial. By mid-morning, the index had fallen approximately 4,567 points, a drop of nearly 2.7 percent. Although the market rebounded slightly later, trimming losses to around 4,450 points, the downward trend resumed by 2 PM, with the index settling near 161,938.15 points—down 5,253.22 points from the opening level.
Market analysts linked the sharp downturn to escalating geopolitical tensions after the talks hosted in Islamabad between Washington and Tehran failed to yield a definitive agreement. The uncertainty surrounding future diplomatic efforts unsettled investors, prompting a cautious, risk-averse stance.
Meanwhile, global oil prices surged past $104 per barrel amid reports of rising regional tensions. This increase followed a statement by former US President Donald Trump about imposing a blockade on maritime routes connected to Iranian ports via the Strait of Hormuz, raising fears of disruptions to the global energy supply.
Experts highlight that the combination of stalled diplomacy and soaring oil prices has intensified market volatility, likely to persist in the near term. Nonetheless, there is tentative optimism as both the US and Iran have expressed willingness to continue dialogue and uphold a ceasefire framework.
Looking forward, investors are expected to closely watch upcoming negotiation rounds, with Qatar and Switzerland reportedly offering to host future talks aimed at resolving the deadlock.
