Negative sentiments engulfed the Pakistan Stock Exchange (PSX) amid escalating tensions between the US and Iran, with the benchmark KSE-100 Index shedding over 2,300 points during the opening hours of trading on Monday.
During the intraday trading the equities recovered some value and at 11:15 am, the KSE-100 index lost 1,731.73 points to stand at 180,510.04 points. However at the close of business, the index recorded a loss of 2,324.73 points or minus 1.29 percent to 179,927.04 points.
Market sentiment remained under pressure after the US and Iran exchanged fresh strikes in an escalating contest over control of the Strait of Hormuz. Oil prices also jumped more than four per cent on Monday due to the renewed fighting.
Across-the-board selling was observed in key sectors, including automobile assemblers, cement, commercial banks, oil and gas exploration companies, OMCs, and power generation. Index-heavy stocks, including HUBCO, MARI, OGDC, PSO, SSGC, SNGPL, MCB, MEBL, NBP, and UBL traded in the red.
During the previous week, the PSX had snapped its winning streak as renewed geopolitical tensions following fresh US-Iran military strikes dampened investor sentiment, prompting widespread selling and dragging the benchmark index lower.
The benchmark KSE-100 Index had declined by 1.7% on a week-on-week basis, losing 3,130.43 points to close at 182,241.77 points.
Internationally, share markets slid in Asia on Monday as fighting intensified in the Gulf and Iran claimed to have closed the vital Strait of Hormuz, sending oil prices surging and rekindling inflation risks globally.
The dollar rose with bond yields as investors narrowed the odds of a hike in interest rates from the Federal Reserve, just a day before Chair Kevin Warsh is due to face Congress for the first time in his new role.
Inflation figures for June on Tuesday could show some cooling in the headline rate of 4.2% as petrol prices decline, though some of that will reverse now that oil is rising anew.
Brent crude climbed 4.1% to reach $79.11 a barrel, up from the recent trough of $70.14, while U.S. crude added 4.1% to $74.37 a barrel.
Equity investors will be hoping the earnings season proves as upbeat as forecast, with the major banks kicking off from Tuesday, while Netflix and General Electric are also on the docket.
