PSX dips nearly 1,000 points as Middle East tensions weigh on investor sentiment

The benchmark KSE-100 index closed 0.57 per cent lower on Tuesday, according to Dawn, having earlier slid to an intraday low of 171,490.63 points around 1:30pm. The index finished at 172,642.16 points, which was 993.91 points below the previous close, after recovering part of its midday losses.

Awais Ashraf, director of research at AKD Securities, linked the decline to the prolonged tensions between the United States and Iran, which he said were weighing on sentiment among investors. He also pointed to higher oil prices as an extra source of pressure, but argued that solid macroeconomic indicators and a recent Eurobond issue give policymakers more room than during earlier shocks.

Houthi attacks on Saudi energy facilities have added to regional strain, and oil markets rallied, with Brent reaching $99.22 a barrel, a level not seen since July 24. West Texas Intermediate climbed to $94.60, its loftiest point since June 8. The benchmark had also dropped 1,692.74 points on Monday to end at 173,636.08.