Broad-based rally fuelled by de-escalation hopes as investors turn optimistic about global peace
Islamabad
The Pakistan Stock Exchange (PSX) opened on a distinctly bullish note as a renewed whisper of global calm set the tone for trading on Tuesday. The benchmark KSE-100 Index surged sharply by over 5,043.51 points or 3.14%, ultimately settling at 165,634.85, as buying momentum remained intact throughout the session.
At 9:39am, the index was hovering around 164,322.07, with gains of 3,730.74 points or 2.32%. During the session, the market touched an intra-day high of 165,763.81 and a low of 163,416.54, tracking a firm and sustained upward trajectory throughout the day.
The rally followed growing expectations of a possible resumption of diplomatic talks between the United States and Iran, reviving hopes of de-escalation in a conflict that has shaken global financial markets. The shift in sentiment came in stark contrast to the previous session, where the market endured heavy losses amid failed negotiations and a spike in oil prices, triggering widespread panic selling across sectors.
Early gains were broad-based, led by index-heavy sectors such as automobile assemblers, cement, commercial banks, fertiliser, oil and gas exploration companies, OMCs, power generation and refinery, as participants moved to rebuild positions after the recent sell-off. The sharp rebound underscored the market’s sensitivity to geopolitical signals, where even tentative progress towards peace could ignite strong bullish momentum.
Despite the upbeat start, analysts cautioned that volatility may persist, with much depending on whether diplomatic efforts translate into concrete outcomes. “Investors are optimistic on the likely resumption of talks between the US and Iran,” AKD Securities Director Research Mohammed Awais Ashraf told The Express Tribune.
Timely affirmation from Saudi Arabia and Qatar to bridge the gap in external financing to be created by the payment of UAE $3.5 billion this month and higher imports due to elevated oil prices have also helped uplift the sentiment, he added. This is also likely to help in the timely approval of a $1.2 billion disbursement from the International Monetary Fund (IMF) after the approval of its executive board, Ashraf predicted.
KTrade Securities Equity Trader Ahmed Sheraz also wrote in their Market Wrap that PSX staged a strong rebound as sentiment sharply reversed following encouraging geopolitical developments.
Additionally, easing global risk perception, along with a pullback in international oil prices towards the $97-99 per barrel range, provided additional support to equities. Positive cues from overnight US markets and strength across Asian markets also reinforced positive momentum throughout the session.
The upside was broad-based, with heavyweights across commercial banks, cement, E&P, and fertiliser sectors driving the index higher, with key names including United Bank, Engro Corporation, Hub Power, Oil & Gas Development Company, Habib Bank, National Bank, and MCB Bank contributing significantly.
Going forward, market direction will remain closely tied to developments on the geopolitical front, particularly the trajectory of US-Iran negotiations and global oil price trends. If diplomatic momentum sustains and energy prices remain contained, sentiment is likely to stay positive, although near-term volatility cannot be ruled out, Sheraz added.
Overall trading volume increased to 824.5 million shares versus Monday’s close of 743.2 million. Meanwhile, the value of traded shares stood at Rs36.3 billion. Shares of 487 companies were traded, of which 389 stocks jumped, 64 closed with losses and 34 remained unchanged.
WorldCall Telecom was the volume leader, trading in 100.2 million shares and rising Rs0.07 to close at Rs1.54.
