PSX slips into red as US-Iran uncertainty and IMF review weigh

The Pakistan Stock Exchange's benchmark KSE-100 Index gave up early gains to trade marginally lower by midday on Tuesday, as caution over global developments and the country's International Monetary Fund review weighed on sentiment. The index had risen 324.35 points, or 0.19 per cent, to 170,749.97 by 9:38am, supported by buying in automobiles, cement, commercial banks, fertiliser, oil and gas exploration companies and oil marketing companies. It later reversed course and was hovering around 170,363.09, down 62.53 points, or 0.04 per cent, with an intraday high of 170,944.34 and a low of 170,319.05. Trading volume stood at 73.34 million shares and turnover at about Rs4.49 billion, against the previous close of 170,425.62.

The reversal came as global markets remained sensitive to developments in the US-Iran conflict and uncertainty over a possible diplomatic breakthrough. US and Iranian officials are pursuing separate talks through mediators, with Qatar seeking a deal to end the conflict and reopen the Strait of Hormuz, while Washington is also seeking commitments on Iran's nuclear programme. Oil prices rose for a second straight session on Tuesday as concerns over disruption to Middle Eastern supplies outweighed signs of recovering regional exports.

Higher oil prices are a particular concern for Pakistan, where prolonged energy-market pressure can add to import costs and external-sector pressures, keeping investors cautious ahead of domestic economic developments. Formal talks between Pakistan and the visiting IMF mission have also begun for the fourth review under the $7 billion Extended Fund Facility and the third review under the Resilience and Sustainability Facility. The mission has held discussions with officials from the finance ministry, FBR and other departments.

The IMF discussions are taking place against a backdrop of pressure on Pakistan's fiscal and external accounts from the regional conflict and higher energy costs. The review remains a key domestic market focus, alongside developments in global oil prices and the US-Iran situation.