Buying interest returns, KSE-100 up nearly 2,700 points in early trade

Buying interest returned to the Pakistan Stock Exchange (PSX) on Wednesday, with the benchmark KSE-100 Index rebounding sharply after suffering one of its steepest declines a day earlier. During the opening minutes of trading, the index gained nearly 2,700 points, reflecting renewed investor confidence.

 

As of 9:38 a.m., the KSE-100 Index stood at 176,192.90, up 2,674.09 points, or 1.54%, from the previous close.

 

Strong buying activity was witnessed across several major sectors, including automobile assemblers, cement, commercial banks, oil and gas exploration companies, oil marketing companies (OMCs), power generation, and refineries. Heavyweight stocks such as ARL, HUBCO, MARI, OGDC, PPL, POL, MCB, MEBL, NBP, and UBL all traded in positive territory, supporting the market's recovery.

 

The rebound came a day after the PSX experienced one of its worst trading sessions, when the KSE-100 Index plunged 6,408.23 points, or 3.56%, to close at 173,518.82. The sharp decline was driven by panic selling amid escalating geopolitical tensions in the Middle East and growing concerns over the conflict between the United States and Iran, which raised fears of potential disruptions to global oil supplies.

 

Global market sentiment also improved on Wednesday. Asian equities advanced after U.S. inflation data unexpectedly showed a slowdown in price growth, reducing expectations of further interest rate hikes by the Federal Reserve. Investor confidence was further supported after the United States abandoned a proposal to impose shipping charges through the Strait of Hormuz, easing concerns over energy transportation.

 

Strong earnings from major Wall Street banks also lifted market sentiment. However, technology giant IBM fell 25% after issuing weaker-than-expected revenue guidance, highlighting continued volatility in AI-related technology stocks.

 

Among Asian markets, South Korea's KOSPI jumped 6% in early trading, while Japan's Nikkei 225 gained 0.4%. Meanwhile, MSCI's Asia-Pacific index excluding Japan rose 1.7%, reflecting broad-based optimism across regional markets.

 

In currency markets, the U.S. dollar weakened against most major currencies, although it remained firm against the Japanese yen. U.S. government bond prices also strengthened, with the two-year Treasury yield falling 11 basis points to 4.19%, retreating from Tuesday's 17-month high of nearly 4.3%.

 

The positive market reaction followed the release of U.S. inflation data, which showed the Consumer Price Index (CPI) declined 0.4% in June, marking the first monthly decrease since the COVID-19 pandemic. Core inflation slowed to an annual rate of 2.6%, below market expectations of 2.8%, reinforcing hopes that inflationary pressures are easing.