PSX Plunges Over 5,000 Points as US-Iran Talks Fail, Triggering Global Energy Panic

The Pakistan Stock Exchange (PSX) witnessed a massive rout on Monday, plunging over 5,000 points. The sharp decline was directly attributed to the inconclusive nature of the US-Iran peace talks held in Islamabad. Investors reacted strongly to the lack of immediate diplomatic breakthrough, sending shockwaves through the market.

KSE-100 Index Plunges Amid Heavy Selling​

Trading commenced on a highly cautious note, quickly giving way to heavy selling pressure by mid-day. The benchmark KSE-100 Index saw a precipitous fall of 5,353.67 points, representing a -2.73% drop.

Within the first two hours of the trading session, the index fell sharply, closing at 162,624.06. While the market exhibited significant intra-day volatility, the index eventually managed a partial recovery. The bourse trimmed some of the losses, settling at 162,740.40, reflecting a drop of 4,450.97 points (-2.66%).

Geopolitical Tensions Drive Commodity Shock​

Adding fuel to the panic selling mode, global commodity markets reacted intensely. The announcement by US President Donald Trump regarding a potential blockade on maritime traffic to and from Iranian ports via the Strait of Hormuz escalated fears.

This geopolitical uncertainty spurred a sharp surge in global oil prices. Crude benchmarks jumped by over 7 per cent, soaring above USD 100 per barrel. The simultaneous economic shocks reinforced the selling pressure observed in the domestic equity markets.

Expert Viewpoints Stress Uncertainty​

Analysts noted that the volatility was a direct consequence of global geopolitical instability. Kaukab Farshori of Capital Investments stated that such volatile environments were expected at the opening of the week.

He attributed the market's weakness primarily to the continued lack of clarity surrounding the negotiations between Iran and the US. This uncertainty weighed significantly on overall investor confidence across various sectors.