Karachi, June 8, 2026: The Pakistan Stock Exchange (PSX) came under heavy selling pressure on Monday, with the benchmark KSE-100 Index plunging more than 1,500 points as escalating tensions in the Middle East triggered a sharp rise in global oil prices and heightened concerns over Pakistan’s external account, interest-rate outlook and the upcoming federal budget.
The KSE-100 Index closed at 168,953.70 points, down 1,525.24 points, or 0.89 percent, from the previous close of 170,478.94.
During the trading session, the benchmark index touched an intraday high of 169,254.13 points and a low of 168,432.45 points, reflecting investor anxiety amid mounting geopolitical and economic uncertainties.
Market analysts attributed the decline primarily to renewed hostilities involving Iran and Israel, which have fueled fears of prolonged regional instability and disruptions to global energy supplies.
Global oil markets reacted strongly to renewed military exchanges in the Middle East.
Brent crude futures climbed more than $3 per barrel, rising 3.39 percent to $96.24 per barrel, while US West Texas Intermediate (WTI) crude gained 3.17 percent to reach $93.41 per barrel.
The rally was initially triggered by Israeli strikes in Lebanon and intensified following reports of explosions in several Iranian cities, including Tehran, Isfahan and Tabriz.
The latest escalation has renewed concerns about the security of energy supplies passing through the Strait of Hormuz, one of the world’s most critical oil transit routes. Investors fear any disruption could further elevate oil prices and increase import costs for energy-dependent economies such as Pakistan.
The gains also reversed losses recorded on Friday when hopes of diplomatic progress had briefly eased concerns about a wider regional conflict.
Higher international oil prices pose a significant challenge for Pakistan’s economy, potentially widening the current account deficit, increasing inflationary pressures and complicating monetary policy decisions.
Market participants are increasingly concerned that a sustained rise in energy prices could limit the central bank’s room for monetary easing and may even revive discussions about future interest rate increases.
These concerns have emerged at a sensitive time as the government prepares to unveil the federal budget for fiscal year 2026-27, with investors closely watching fiscal measures, taxation proposals and economic reforms.
