KARACHI (Kashmir English): The Pakistan Stock Exchange (PSX) witnessed a remarkable surge on Tuesday as the KSE-100 Index jumped by more than 4,000 points at the opening bell. The rally came shortly after news broke of a ceasefire between Iran and Israel, bringing a wave of optimism across regional markets.
According to market reports, the KSE-100 Index surged by 4,332 points, restoring four major chart levels in just a single trading session. Investors reacted positively to the news of de-escalation in the Middle East, which had been causing uncertainty and nervousness in global and local financial markets for the past two weeks.
The move follows a day after the stock market experienced a bloodbath after it dropped 3,855.77 points in one day following rising tension in the Middle East after the US attacked the three Iranian nuclear facilities.
Today, the KSE-100 rebounded with full strength, crossing the 120,000 psychological barrier. The benchmark index climbed an impressive 4,361.68 points, or 3.75%, to hit 120,529.15 during intraday trading.
This sudden climb is an indication of high investor confidence, which is fuelled by the better state of affairs in the Middle East.
The index also recorded an intraday high of 120,647.18 during the day, with the low staying at 120,369.53 – indicating a relatively narrow trading range with continued buying pressure. The volume of trade was also healthy as 14.27 million shares were traded in different sectors.
Analysts are of the view that the stabilisation of investor sentiment was a result of the easing of geopolitical tensions as a result of the Iran-Israel ceasefire. The KSE-100 Index, which had been under pressure in the last few days because of the rising oil prices and the threat of spillover of the conflict, rallied strongly as traders rejoiced at the prospect of a permanent peace.
Experts believe that the easing of geopolitical tensions due to the Iran-Israel ceasefire helped stabilise investor sentiment. The KSE-100 Index, which had experienced pressure in recent days due to rising oil prices and fears of conflict spillover, rebounded sharply as traders welcomed the possibility of lasting peace.
Also, the ceasefire contributed to the reduction of international oil prices, which is a positive aspect of the economy of Pakistan, which is highly dependent on energy imports. The falling oil prices will also ease the inflationary pressure, which is another boost to the trading floor.
For now, though, investors are celebrating the much-needed breather, as the KSE-100 Index delivers one of its biggest single-day point increases in recent memory.
