The Pakistan Stock Exchange (PSX) came under renewed selling pressure on Tuesday, with the benchmark KSE-100 index falling 1,904.31 points, or 1.10 per cent, during intraday trading as escalating tensions in the Middle East weighed on investor sentiment.
At 1:39pm, the index stood at 171,731.76 points, down from the previous close of 173,636.07.
Awais Ashraf, director of research at AKD Securities, attributed the decline to the prolonged tensions between the United States and Iran, saying the situation was weighing on investor confidence.
“The increase in oil prices is also adding to the pressure,” he said.
However, Ashraf said strong macroeconomic indicators and Pakistan’s recent return to the international Eurobond market provided policymakers with some cushion compared with previous external shocks.
Regional tensions intensified after recent Houthi attacks on Saudi energy facilities, which contributed to a rise in global oil prices and heightened concerns over energy supplies.
Brent crude futures rose $2, or 2.06 per cent, to $99 a barrel by 1pm Pakistan time, while US West Texas Intermediate crude climbed $2.93, or 3.2pc, to $94.41 a barrel.
Brent earlier touched $99.22 a barrel, its highest level since July 24, while WTI reached $94.60, its highest since June 8.
The rise in oil prices, coupled with geopolitical tensions and domestic political uncertainty, has contributed to increased selling pressure at the PSX this week.
On Monday, the KSE-100 index fell 1,692.74 points, or 0.97pc, to close at 173,636.08 as investors booked profits amid concerns over the Middle East situation and higher international oil prices.
