PSX KSE-100 falls more than 600 points as US-Iran tensions unsettle markets

Pakistan’s benchmark KSE-100 index opened sharply lower on Monday as renewed fighting between the United States and Iran increased geopolitical uncertainty and weighed on investor sentiment.

The KSE-100 index dropped more than 600 points shortly after trading began, falling to 177,066 points from Friday’s close of 177,696.

The decline reflected growing concerns among investors about the potential economic impact of escalating tensions between Washington and Tehran, particularly through higher energy prices and increased volatility in global financial markets.

The pressure on the Pakistan Stock Exchange came as Asian markets also fell following renewed US-Iran fighting.

Nepal floods Rescuers race to reach hundreds trapped in hydropower tunnels

Global investors moved cautiously as the latest escalation pushed oil prices higher and kept bond yields elevated, while expectations surrounding US interest-rate policy also shifted.

Brent crude futures rose 2.8% to $90.60 a barrel after US forces struck two Iranian launchers on Larak Island on Sunday, according to reports.

Iran subsequently launched attacks against US forces stationed in Jordan, Fox News reported.

The geopolitical tensions weighed on major Asian equity markets. Japan’s Nikkei 225 fell 1.6%, while South Korea’s benchmark index declined 2.2%.

MSCI’s broadest index of Asia-Pacific shares outside Japan also dropped 1.2%.

For Pakistan, a sustained rise in global oil prices could add pressure to the country’s import bill and inflation outlook, while heightened geopolitical uncertainty could further influence foreign investor sentiment.

Market participants are expected to closely monitor developments in the Middle East and their impact on oil prices, regional markets and currency movements during the week.