PSX rallies over easing political woes

Index surges 2,593 points as call for govt-PTI dialogue lifts sentiment IMF taxes squeeze salaried class Pakistan Stock Exchange (PSX) staged a strong recovery on Tuesday, with the benchmark KSE-100 index surging 2,592.79 points, or 1.56%, to settle at 168,460.11, as broad-based buying gathered pace amid hopes for reduced domestic political tensions. Investor sentiment improved after Prime Minister Shehbaz Sharif called on the Pakistan Tehreek-e-Insaf (PTI) to abandon its politics of agitation and cancel its long march, saying protests would damage economic growth and Pakistan's international standing. The call for dialogue, conditional on ending the agitation, provided some relief to investors concerned about renewed political uncertainty. The index traded between the intra-day high of 168,626.18 and low of 165,651.68, recovering strongly from the session's early levels as buying emerged across key sectors. Investor interest was witnessed in auto assemblers, cement, commercial banks, oil and gas exploration companies, oil marketing firms, power generation and refineries. Meanwhile, international oil prices eased as resilient Middle Eastern crude exports and a G7 emergency stockpile release reduced immediate supply concerns, although security risks in the region continued to cap further decline. "The decline in international oil prices, along with the government's indication that it remains open to negotiations with the PTI to end the long march, helped improve investor sentiment," AKD Securities Director Research Mohammed Awais Ashraf told The Express Tribune. The easing of both external and domestic concerns encouraged fresh buying across key sectors and supported the broader market recovery, he added. After Monday's heavy sell-off and margin-driven liquidation, the market initially remained subdued and consolidated on thin volumes, but improving domestic and global cues triggered broad-based buying and a strong recovery, commented Ahmed Sheraz of KASB KTrade. Buying was visible across commercial banks, oil & gas, cement firms, investment banks and power, with Engro Holdings, UBL, Hub Power, HBL, OGDC and Mari Energies closing the session in the green. Sentiment was further supported by easing oil prices, with Brent falling below $100 to around $98, amid improving Red Sea conditions, G7-backed strategic oil releases and price support from Saudi producers. Additionally, hopes for US-Iran dialogue also reduced geopolitical risks after President Trump indicated Washington was open to direct talks. On the domestic front, the government's outreach to the opposition for negotiations added another layer of clarity, helping the market regain confidence. Ali Najib, Deputy Head of Trading at Arif Habib Limited (AHL), observed that following Monday's sharp sell-off, the market rebounded amid easing international oil prices and improved Middle East oil flows, which helped restore investor confidence. On the sectoral front, oil production declined 6.4% week-on-week to 63.7k barrels per day, primarily due to lower flows from northern fields, while gas production fell 1.4% WoW to 2,999 mmcfd, mainly due to reduced output from Mari, Sui and Sharf. On the corporate front, Sazgar Engineering's total sales increased 22% year-on-year to 10,872 units in the first quarter of fiscal year 2026-27, driven by a 45% rise in three-wheeler sales, while four-wheeler sales declined 12%, Najib added. Trading volumes fell to 432 million shares from 441.9 million recorded on Monday, while the value of traded shares stood at Rs20.1 billion. Shares of 496 companies were traded in the ready market, of which 314 closed higher, 147 declined and 35 stood unchanged.