KARACHI: There was a big sigh of relief on Tuesday at the Pakistan Stock Exchange, as traders pushed the index nearly 5,800 points higher after word spread that Iran and Israel may finally be putting down their weapons — at least for now.
Following a tense few weeks of military strikes and soaring oil prices, US President Donald Trump made a surprise late-night announcement that the two arch-rivals had agreed to a “complete ceasefire” to end their 12-day fight.
The news sent a wave of optimism through the local market. By the afternoon, the KSE-100 had jumped by over 5,700 points to reach almost 122,000 — a gain of nearly 5% in a single day. The rally was so strong that PSX had to hit the brakes and halt trading for an hour to cool things down.
But the peace buzz didn’t last all day — as reports surfaced that Israel accused Iran of breaking the truce, some investors hit pause, causing a slight dip from the day’s peak. Still, experts say local companies are standing on solid ground and, if calm holds in the region, the market could keep climbing.
Global markets also celebrated the news. Oil prices dropped by 5%, easing fears of supply hiccups that had worried businesses everywhere.
Chase Securities’ Yousuf M. Farooq said, “The rally shows investors want peace. If tensions flare again, we could see another pullback — but for now, people are hopeful.”
Monday’s trading had been brutal for PSX, as Middle East tension wiped out over 3,800 points from the index. Tuesday’s dramatic bounce-back was a welcome change of mood.
Iran, for its part, played it cool — its foreign minister said there’s no signed deal yet, but hinted that if Israel stops attacking, Iran will too. So, traders will be watching every headline closely this week.