Pakistan stocks fall on crude prices and Iran tensions

The benchmark index spent most of the week under pressure, falling in the first three sessions before recovering modestly into Friday. It dropped 721 points on Monday, 509 points on Tuesday and 1,690 points on Wednesday before inching higher in the last two sessions.

Arif Habib Limited said the market consolidated amid renewed US-Iran tensions, with corporate earnings offering only partial support. Topline Securities also pointed to higher crude prices as a key drag.

Investors were also digesting mixed domestic signals. The Federal Board of Revenue collected Rs902 billion in August, short of target, while Pakistan posted a $3.2 billion trade deficit for the month as imports outpaced exports. At the same time, Fitch assigned Pakistan’s proposed dollar bond and medium-term note programme a ‘B’ rating, and the government raised $3 billion through a dual-tranche Eurobond sale.

Market flows showed local buyers trying to absorb the pressure, with individuals and local companies buying net equities, while mutual funds and foreign corporates were sellers. Average daily traded value held at Rs33 billion, suggesting positioning stayed active even as sentiment weakened.

For investors, the immediate watchlist is crude oil, any further escalation in the Gulf and whether rising inflation forces a more cautious outlook for Pakistan equities. A durable rebound in the KSE-100 likely needs either a de-escalation in the conflict or signs that energy costs are stabilizing.