PSX Slides 1,734 Points as IMF Review, Middle East Uncertainty Weigh

KSE-100 closes 1.01% lower amid geopolitical tensions and elevated oil prices

Selling pressure returned to the Pakistan Stock Exchange (PSX) on Thursday, pushing the benchmark KSE-100 Index down more than 1,700 points. Investors stayed cautious over Pakistan’s ongoing IMF programme review and unresolved tensions in the Middle East, where US-Iran diplomatic discussions appeared to make little progress.

The market opened with volatility, reaching an intraday high of 172,491.16 during morning trade. Gains subsequently reversed, and sustained selling built during the second half of the session.

Selling intensified in the final hour, driving the benchmark to an intraday low of 170,418.38 before a slight recovery.

The KSE-100 finished at 170,498.94, down 1,733.57 points, or 1.01%, from Wednesday’s close of 172,232.51.

Declines were widespread across major sectors, including automobile assemblers, cement, commercial banks, oil and gas exploration companies and oil marketing firms. Refinery shares also weakened despite encouraging developments regarding long-overdue upgrades to Pakistan’s refining infrastructure.

Cnergyico PK Limited, National Refinery Limited (NRL) and Attock Refinery Limited (ARL) have signed upgrade agreements with the government, marking progress toward modernising existing refineries under the brownfield refinery policy.

Investors were also closely following Pakistan’s engagement with the IMF as a mission opened discussions for the fourth review under the country’s $7 billion Extended Fund Facility and Resilience and Sustainability Facility.

Prime Minister Shehbaz Sharif met IMF Managing Director Kristalina Georgieva on the sidelines of the UN General Assembly 2026 on the day the review discussions began.

In a statement, the Prime Minister’s Office said Sharif thanked the IMF for its continued support for Pakistan’s economy and reaffirmed the government’s commitment to implementing the reform programme.

Georgieva said the meeting focused on Pakistan’s reform efforts.

She wrote on X that sustained implementation had helped preserve stability, rebuild confidence and restore access to international markets.

Thursday’s decline followed a stronger session on Wednesday, when the market advanced amid constructive US-Iran discussions, the arrival of the IMF staff mission and heavy buying in refinery shares ahead of possible progress on upgrade agreements.

On Wednesday, the KSE-100 gained 830.43 points, or 0.48%, to close at 172,232.51.

Overseas, debt markets were volatile as Japanese bonds followed US Treasuries lower. Asian equities traded mixed as investors assessed Middle East tensions and prospects for US-China trade talks.

The MSCI Asia ex-Japan Index fell 0.64%, while Japan’s Nikkei 225 gained 1.73%. Australian shares also declined, with the S&P/ASX 200 dropping 1.2% to a more than three-month low.

Oil prices pulled back from recent highs, while the US dollar retained its gains after Iranian leader Ayatollah Ali Khamenei vowed not to surrender, following a warning from US President Donald Trump that he could “annihilate” Iran.

Traders were also awaiting speeches from central bank officials and key economic data, including US jobless claims, for clues about the prospect of further interest rate increases.

A summit between Trump and Chinese President Xi Jinping was another focal point, with investors looking for signs of progress in trade relations.

In Pakistan, the rupee extended its modest gain against the US dollar, appreciating 0.01% in the interbank market. It closed at 277.17, up Re0.03 for the day.

Trading volume on the all-share index slipped to 759.97 million shares from 773.59 million in the previous session.

However, turnover rose to Rs27.54 billion from Rs26.45 billion, reflecting the higher average value of shares traded.

Cnergyico PK led volume with 158.26 million shares, followed by K-Electric with 71.89 million and F. Nat. Equities with 59.94 million.

Shares of 495 companies traded, with 101 advancing, 358 declining and 36 remaining unchanged.

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