Political uncertainty, regional tensions drag PSX into the red

Shares on the Pakistan Stock Exchange came under heavy pressure on Monday, according to Profit, after governor's rule was imposed in Khyber Pakhtunkhwa and regional tensions escalated. Houthi strikes against airports in Saudi Arabia and threats to shipments through the Strait of Hormuz added to investor unease. The KSE-100 index at one stage lost more than 1,000 points before recovering some ground, and at 12:10 pm it was at 166,213.50, a decline of 875.77 points, or 0.52%.

Losses were broad, with car makers, cement producers, banks, upstream energy firms, fuel retailers and power generators all under pressure. The index had lost 1,066 points, or 0.6%, in the week before, and trading activity thinned as the daily average fell 16.5% to 541 million shares. The brokerage AKD Securities believes stronger economic data and cooling inflation could support equities, and a calmer Middle East could ease oil prices and create room for monetary easing.

Global markets began the day erratically as earnings season threatened to test high technology valuations, while oil slid amid doubts over whether Russia could boost energy exports. Brent crude eased to $104.61 a barrel by 0627 GMT, while West Texas Intermediate was at $91.36, and both benchmarks had shed over 1 per cent earlier.