Selling hits key sectors as oil prices surge nearly 3% amid Middle East escalation
KARACHI:
The Pakistan Stock Exchange (PSX) surrendered more than 720 points on Monday as selling pressure kept the benchmark KSE-100 Index under pressure, with escalating geopolitical tensions, rising international oil prices and cautious investor sentiment weighing on the market.
Selling was observed in key sectors, including automobile assemblers, cement, commercial banks, oil marketing companies, oil and gas exploration companies and power generation.
The index had already lost 569.66 points, or 0.32%, within minutes of trading to reach 177,126.84 by 9:34am.
Read: Iran still wants negotiated end to war, president says after exchanges of fire
Investor sentiment remained cautious as international oil prices rose nearly 3% after the United States attacked an Iranian island in the Strait of Hormuz and Tehran retaliated, extending the conflict into its sixth month. The escalation also weighed on Asian markets, with major regional equities declining during the session.
The benchmark KSE-100 index touched an intraday high of 178,138.69 and a low of 176,944.91 and eventually fell 720.83 points, or 0.41%, to settle at 176,975.68.
According to Ahmed Sheraz of KTrade Securities, the KSE-100 index closed at 176,975 points, down 720 points (-0.41%) day-on-day, with approximately 494 million shares traded. The session remained under pressure as selling in commercial banks, cement and technology stocks weighed on the index, with United Bank, Systems, Habib Bank and Lucky Cement among the major negative contributors.
Meanwhile, refineries, however, stood out as the key outperforming sector, with Pakistan Refinery, National Refinery and Attock Refinery posting notable gains amid expectations surrounding the signing and implementation of the refinery upgrade policy in the coming month. This selective strength provided some support, though it was insufficient to offset broader weakness across heavyweight sectors.
Read more: Oil rises over 3% as US, Iran resumes military attacks
Looking ahead, Sheraz anticipated the market sentiment likely to remain cautious amid renewed US-Iran escalation and a sharp rise in oil prices, with Brent trading near $91 per barrel, up nearly 6% DoD. “With the results season and August now behind us, September’s market direction may largely hinge on developments in regional tensions, crude oil prices, inflation expectations and the broader macroeconomic outlook,” he said.
Overall, trading volume jumped to 937.2 million shares from Friday’s total of 658.3 million. The value of traded shares stood at Rs39.1billion. In the ready market, shares of 503 companies were traded. Of these, 169 stocks closed higher, 302 fell, and 32 remained unchanged. Cnergyico PK was the volume leader, with trading in 293.2 million shares, rising Rs1.05 to close at Rs15.46.
